IGI Logo

Strong hiring, rebound in real estate augurs well…

About the stock: Info Edge provides internet based service delivery like recruitment services (Naukri), real estate (99 acres), Jeevansaathi and Shiksha.

* Quasi play on Indian start up like Zomato, PolicyBazaar, Shoekonect, Ustra, Gramophone and job market, matrimony services & real estate market

* Prudent capital allocation and recruitment business EBITDA margin >50%

Q3FY22 Results: Info Edge reported robust Q3FY22 results.

* Revenues increased 14.7% QoQ, aided by recruitment business growth of 16.4% QoQ

* EBITDA margin dipped 240 bps QoQ to 27.8%

* Billing increased 16.4% QoQ, 57.6% YoY to | 356 crore

What should investors do? Info Edge’s share price has grown by ~6x over the past five years (from ~| 824 in January 2017 to ~| 4,900 levels in January 2022).

* We continue to remain positive and retain our BUY rating on the stock

Target Price and Valuation: We value Info Edge at | i.e. 5800 on SOTP basis.

Key triggers for future price performance:

* Improving hiring trend in IT, healthcare, education, telecom and improving billing trend to drive recruitment revenues

* Lower interest rate and affordability is expected to drive 99acres revenues. Traction in Jeevansaathi, Shiksha to further drive revenues

* Expect revenues to grow at a CAGR of 21.4% over FY21-24E

Alternate Stock Idea: Apart from Info Edge, in IT coverage we also like Teamlease.

* Key beneficiary of formalisation of economy and underpenetrated temp staffing market

* BUY with a target price of | 4,500

To Read Complete Report & Disclaimer Click Here

https://secure.icicidirect.com/Content/StaticData/Disclaimer.html

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer