Buy IndiaMart InterMesh: target of Rs 1900: ICICI Securities

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • ARPU expansion: IndiaMART's revenue growth is driven by improved realisations, with ARPU growing 10.8% YoY to INR 72k p.a.
  • Cost discipline: EBITDA margin expansion of 397bps YoY, supported by restrained sales spending, is expected to normalize as sales investments increase.
  • BUSY growth: 27% YoY revenue growth in BUSY, with management expecting billing growth to recover to 20-30% from Q3FY27.
  • Data protection: Measures to protect proprietary data from AI agents, including placing key information behind login and restricting scraping, may impact enquiry growth.

Thesis Validation Checklist

  • Subscriber growth: Watch for signs of improvement in subscriber additions and retention, particularly among 'Silver' subscribers.
  • ARPU growth: Monitor ARPU expansion and its sustainability.
  • EBITDA margin: Track EBITDA margin performance as sales spending increases.
  • BUSY billing growth: Look for recovery in billing growth to 20-30% from Q3FY27.
  • Data monetisation: Observe progress in monetising redacted, non-PII data for LLM training. The thesis is challenged by muted subscriber additions, sustained elevated churn rates, and stagnating ARPU growth.