If you are looking to invest in Info Edge, know about the company
Founded by Sanjeev Bikhchandani in 1997, Info Edge (India) Ltd., is an internet company that has an online job portal (Naukri.com), a matrimony website (Jeevansathi.com), a real-estate classifieds platform (99 Acres.com) and an educational website (Shiksha.com). In addition to this, it also has a stake in 23 companies, including Zomato and PolicyBazaar, both of which are ‘unicorns’ in the start-up world (worth more than $1 billion).
Naukri.com is the biggest part of the company. Over the last one year, it has seen a massive increase in billables. This increase is largely due to the higher demand for jobs in the IT Sector. The IT sector accounts for more than half of the revenue from hires. In the last quarter, Naukri saw an increase of new unique customers on the website as well. Management expects this to increase across all sectors going forward with the economy improving. In terms of market share, Naukri.com already has the highest number of visitors & time spent on the website as compared to the rest of the industry.
99 acres is the second largest part of the company. The first two months of FY21 were adversely affected for real estate due to the second-wave of COVID-19. However, there was strong recovery in the third month. Management thinks that the recovery has come about strongly due to the affordability of real estate, and expects this to increase going forward. The market has seen an increase in customer spending on real estate digitally.
Info Edge has been spending on advertisement and marketing for Jeevansathi.com and Shiksha consistently so as to gain a competitive edge. They continue to do so and increase their market share.
The company also has a stake in Zomato, which accounts for 50% of the online food ordering market and PolicyBazaar. PolicyBazaar has 90% of market share and offers hundreds of insurances from many insurers on its platform. PolicyBazaar plans to go public in the near future which would increase its valuation as well.
All in all, the company has a strong play on the internet across different sectors. It is an innovative company that aims to make things easier for their consumers digitally. It was one of the first movers on the internet with Naukri.com, and has held a strong market share since. All their verticals are easily accessible to customers via mobile and are fairly convenient for consumers.
Infoedge also has strong financials and positive cash flows from Naukri.com which is used for the other verticals. Given the strong growth potential of the company, it is a stock worthwhile considering for your portfolio in the long run. It provides exposure to start-ups which are otherwise inaccessible to retail investors.
The stock is currently trading at Rs. 6675 per share. It is trading at an all-time high even today and has been consistently doing well, more so since 2019. The share price has increased 3 times (from Rs. 2000) in the last two years.
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