Q3FY21 Result Update - Info Edge (India) - ICICI Direct

Although Info Edge reported a dip in revenues YoY, its performance improved QoQ. Revenues increased 6.3% QoQ to Rs. 272.3 crore while EBITDA margin improved 491 bps QoQ to 25.0%, indicating a recovery in the economy. However, we believe the performance will improve in coming quarters led by opening up of the economy. In addition, billing has also improved 19.0% QoQ indicating improving revenue trends in future.

Valuation & Outlook

The company is witnessing a healthy billing trend on a QoQ basis led by opening up of the economy. Going forward, we expect improving traction in IT & ITeS, healthcare and telecom, improved growth in 99acres, Jeevansathi, Shiksha and introduction of new products to drive long term revenues. This, coupled with margin expansion will further boost profitability. Further, prudent capital allocation, quasi-play on the Indian start up ecosystem (Zomato, PolicyBazaar, like Shoekonect, Ustra, Gramophone) and leadership in recruitment with EBITDA margin of above 50% keeps us optimistic on the stock from a long term perspective. However, the recent run up in the stock factors in most of the positives. Hence, we downgrade the stock from BUY to HOLD and value the stock on an SOTP basis to arrive at a target price of Rs. 5,725 (earlier Rs. 4,090).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_InfoEdge_Q3FY21.pdf

Shares of INFO EDGE (INDIA) LTD. was last trading in BSE at Rs.5094.45 as compared to the previous close of Rs. 5520.2. The total number of shares traded during the day was 79983 in over 6184 trades.

The stock hit an intraday high of Rs. 5570 and intraday low of 5002.4. The net turnover during the day was Rs. 411372527.

Source : Equity Bulls

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