IndiaMART InterMESH Ltd. saw its market capitalization take a significant hit today, as shares dropped by 15%, triggering a loss of over ₹2,300 crore in market cap. The stock tumbled by ₹451.95, falling to ₹2,561.20 as of 9:40 AM, locked in the 15% lower circuit. This sharp decline comes in the wake of the company’s Q2 FY25 results and subsequent negative brokerage reports that have fueled concerns among investors.
Despite a 95% year-on-year (YoY) surge in net profit to ₹135.1 crore and an 18% revenue increase to ₹347.7 crore, investor sentiment has turned negative due to a noticeable slowdown in collection growth. Collection growth moderated to just 5% YoY in Q2 FY25, down from 14% in the previous quarter, causing apprehension about the company’s future growth trajectory. Additionally, rising subscriber churn has become a major concern, further amplifying investor uncertainty.
Brokerage Downgrades Signal Caution
Several leading brokerage firms have expressed concerns over IndiaMART’s slowing growth. Jefferies downgraded the stock from “Buy” to “Underperform,” slashing the target price to ₹2,540. The firm highlighted the moderation in collection growth and the persistence of subscriber churn as key issues impacting future performance. Nuvama also downgraded IndiaMART to “Reduce,” setting a target price of ₹2,500 and pointing to the deceleration in collection growth as a worrying trend.
Investor Reaction and Outlook
The stock’s steep decline today reflects the broader concerns about IndiaMART’s ability to sustain growth in the current market environment. Despite strong profit and revenue numbers, the underlying issues with subscriber retention and collection growth have created significant headwinds. The over ₹2,300 crore loss in market capitalization underscores the magnitude of investor concern.
IndiaMART’s future performance will be closely watched as the company navigates these challenges. Market sentiment will likely hinge on the company’s ability to address these growth concerns and re-accelerate its collection growth in the upcoming quarters.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
