Brokerages remain bullish on Info Edge, with BofA Securities, Citi, Goldman Sachs, and Kotak Securities maintaining Buy ratings on the stock after its September quarter performance. The brokerages highlighted the growing contribution of artificial intelligence-led recruitment products, resilient Naukri margins, and growth at 99acres. Three of the four brokerages raised their target prices, while the planned CEO transition remains a key monitorable.
Info Edge Q2 Results Highlights (Consolidated, QoQ)
- Consolidated net profit increased 7.6% sequentially to Rs 480 crore from Rs 446 crore.
- Revenue rose 2.6% to Rs 904 crore from Rs 881 crore.
- Ebitda advanced 3.9% to Rs 354 crore from Rs 341 crore.
- Ebitda margin improved to 39.2% from 38.7%.
- The board declared an interim dividend of Rs 3 per share.
Here's what brokerages had to say about Info Edge after Q2 results announcement:
BofA Securities: Buy | Target Price: Rs 1,500
- BofA Securities retained its Rs 1,500 target price, supported by double-digit revenue growth and stronger operating profitability in the September quarter.
- Ebitda increased 28% year-on-year, reflecting an improvement in margins.
- The brokerage expects the leadership change to have limited implications for business execution and remains confident about Naukri's margin strength.
- AI and data offerings are becoming meaningful contributors, with annualised revenue reaching Rs 240 crore.
Citi: Buy | Target Price: Rs 1,500
- Citi raised its target price to Rs 1,500 from Rs 1,470, pointing to stronger operating performance and opportunities from AI-led recruitment.
- Brokerage indicated that Ebitda margin expanded 500 basis points year-on-year to 44.8%, highlighting the improvement in operating profitability.
- AI recruitment products have achieved an annualised revenue run rate of Rs 240 crore, providing another avenue for growth.
- The brokerage flagged the CEO succession as a key monitorable even as it sees potential for further AI monetisation.
Goldman Sachs: Buy | Target Price: Rs 1,430
- Goldman Sachs increased its target price to Rs 1,430 from Rs 1,410, retaining its positive stance despite weakness in the recruitment environment.
- GS stated that Ebitda grew 29% year-on-year, indicating resilience in operating performance.
- AI products now account for a high-single-digit proportion of recruitment revenue, underlining their increasing importance to the business.
- The brokerage highlighted the December leadership transition, when Hitesh Oberoi is due to step down as managing director and CEO and Sanjeev Bikhchandani is set to take charge.
Kotak Securities: Buy | Target Price: Rs 1,475
- Kotak Securities also raised its target price to Rs 1,475 from Rs 1,420, citing continued growth in the core recruitment business and emerging AI opportunities.
- The brokerage pointed to total revenue growing at 12.8% year-on-year, while Naukri revenue increased 13.3%.
- Kotak also highlighted the AI recruitment portfolio reaching an annualised revenue of Rs 240 crore.
- Improving Naukri margins and growth at 99acres strengthen the outlook, although the brokerage considers the unexpected CEO transition a factor to monitor.
Also Read: Info Edge (India) Appoints Sanjeev Bikhchandani As Group CEO; Q2 Profit Rises 8% QoQ To Rs 480 Crore
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