IndiaMart InterMesh Shares gained 9% on Approval of Rs 500 Crore Buyback
IndiaMart InterMesh, a prominent online marketplace, reached a record-high share price of ₹3,141.65 after reporting impressive earnings for the quarter ended June 2023. The stock was trading at ₹3,141.65, up 8.31% at market closing time 3.29pm.
During the first quarter of FY24, IndiaMart InterMesh registered a remarkable 78% year-on-year increase in profit, reaching ₹83 crore. This growth was driven by a substantial 26% rise in revenue from operations, which reached ₹282 crore compared to the same period last year.
The increase in revenue was mainly due to a notable 16% rise in the number of paying subscription suppliers on the platform.
IndiaMart InterMesh also performed well operationally, with Earnings before interest, tax, depreciation, and amortization (EBITDA) growing by 20%t to ₹ 77 crore year-on-year.
However, the company's margins saw a slight decline of 200 basis points year-on-year, settling at 27%. Despite this, investors remained optimistic about the company's growth prospects, leading to a significant increase in the stock's value.
To demonstrate confidence in its future performance, IndiaMart InterMesh's board approved a share buyback program of up to ₹500 crore. The buyback will be conducted at a price of
₹4,000 per share, representing a substantial 37% premium over the current market levels.
Following the announcement of the share buyback and the strong quarterly results, the company's stock price surged by 8% to ₹3,141.65 during Friday's trading session on the Bombay Stock Exchange (BSE). The market response reflects investors' positive sentiment towards IndiaMart InterMesh and their belief in its growth prospects.
Total expenses during the quarter increased by 28%, reaching ₹214 crore, indicating the company's willingness to invest in its future expansion and development.
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