IndiaMart Eyes Long-Term Ebitda Margin Of 33%, Plans Higher Customer Retention In Silver Category

IndiaMART InterMESH, India's largest B2B online marketplace, is aiming for double-digit growth in the current financial year and a long-term Ebitda margin of 33%, according to the company's founder and CEO, Dinesh Agarwal.

“In the long term, I would like to maintain an Ebitda margin of about 33%.  Currently, we are not making enough investments in the sales side because the churns are elevated. That is why the Ebitda margin looks at 38-39%. If you look at the three, five-year CAGR level, I think 33% is the right Ebitda to look at,” he told NDTV Profit in an interview on Monday. 

On being asked about the topline and bottom line targets for FY26, he said, “I think we will try for a double-digit growth and let's see what happens.” He refrained from giving any specific guidance.

The company has seen an elevated churn in its Silver category, which is impacting to expand its paid subscription base. The leading B2B online marketplace is prioritising retention in this category, mostly comprising entry-level customers, to aid growth, according to Agarwal.

"The basic issue is that the silver customers themselves are not staying enough. Our first target is to improve our retention level for the first year of the silver customers,” he explained.

To combat this, IndiaMART is prioritising product improvements and better training for both its sales team and new customers, rather than aggressively increasing sales expenditure. Agarwal noted that once churn rates stabilise, the company plans to reinvest in its sales division, which may temporarily impact Ebitda margins but will drive long-term growth.

Currently, gold and platinum customers make up nearly 50% of the subscriber base and contribute 75% of the company's revenue. “So I think our reliance on silver is lower in terms of the financial performance.”

Agarwal highlighted that the top 10% of customers now account for 50% of revenue, up from 40% when the subscriber base was smaller.

Advertising spends, a key driver of unique business inquiries, are set to remain in the Rs 6-10 crore range per quarter for the next two quarters, accounting for 2-3% of revenue.

The company reported a 34.65% year-on-year (YoY) rise in its consolidated net profit at Rs 153.5 crore in Q1FY26 from Rs 114 crore in Q1FY25. Total income grew 20.8% YoY to Rs 464.5 crore in Q1FY26 from Rs 384.5 crore in the preceding fiscal. Its total expenditure increased 11% YoY to Rs 246.5 crore in Q1FY26 from Rs 221.9 crore in Q1FY25.

Shares of Indiamart Intermesh ended 1.87% lower at Rs 2,603 apiece on the NSE, while the benchmark Nifty50 closed 0.49% higher at 25,090.7.