Shares of Info Edge (India) Ltd. surged on Monday to its highest level in over two years after Citi Research upgraded the stock's rating by two notches to 'buy', citing multiple tailwinds for its core business.
The tailwinds include a sustained recovery in recruitment billings/revenue growth, and Ebitda breakeven in non-recruitment verticals, the brokerage said.
For the recruitment business, the company's strong fourth quarter and decent fiscal 2024 indicate that its business is resilient to a challenging IT-services hiring environment, given the non-IT momentum, ability to retain pricing and exposure to the global capability centers.
The brokerage raised the stock's target price to Rs 6,650 apiece from Rs 5,150 apiece, implying a potential upside of 17.18% from Friday's close.
On the NSE, Info Edge's stock rose as much as 9.01% to Rs 6,185.90 apiece, the highest since November, 2021. It was trading 7.8% higher at Rs 6,116 apiece, compared to a 0.48% advance in the benchmark Nifty as of 10:51 a.m.
The share price has risen 61.96% in the last 12 months. The total traded volume so far in the day stood at 2.93 times its 30-day average on the NSE. The relative strength index was at 76.98, indicating that the stock may be overbought.
Fourteen out of the 24 analysts tracking the company have a 'buy' rating on the stock, six recommend 'hold' and four suggest 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 6.8%.
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