Nuvama has downgraded its rating on IndiaMart from Hold to Reduce, citing a sharp slowdown in collection growth to 5% year-on-year, down from 14% in the previous quarter. The target price has been cut to Rs 2500, implying a 16% downside.
Nuvama noted that while margins have improved due to lower marketing expenditures, the risk of further growth underperformance is rising. The only positive takeaway from the quarter was the 14% year-on-year growth in unique business inquiries. Nuvama expects collection growth to stay in the low-double digits, which may start impacting revenue growth moving forward.
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