IndiaMART InterMESH has reported a mixed set of results for the fourth quarter of FY26, with revenue meeting expectations but profitability falling short.
The company posted revenue of Rs 404 crore, marking a 13.9% year-on-year increase, though growth remained largely flat on a sequential basis. However, margins disappointed, with EBIT rising modestly to Rs 126 crore but declining slightly quarter-on-quarter. Net profit saw a sharp drop of over 70% compared to last year, primarily due to losses in treasury income.
Despite the weaker earnings performance, the company’s long-term growth outlook remains broadly intact. Average Revenue Per User (ARPU) continues to be a key driver, rising at around 9% annually. A recent price increase in its Silver subscription tier—the first in six years—is expected to support future growth, although its impact will be gradual as it applies only to new customers.
Customer churn remains a concern, particularly among Silver-tier users, though retention in higher-value Gold and Platinum categories remains stable. Management indicated that improvements in subscriber retention may take several months to materialise.
IndiaMART is also investing in generative artificial intelligence to enhance platform efficiency and user experience. However, meaningful revenue generation from AI-led business solutions has yet to emerge.
Looking ahead, the company expects long-term EBITDA margins in the range of 30–35%, supported by improved retention and sustained investment in sales and marketing.
Analysts have slightly lowered earnings estimates for FY27 and FY28, while maintaining a valuation of 18 times projected FY28 earnings. The target price has been revised marginally upward to Rs 2,235 per share, implying limited upside. The stock retains a “hold” recommendation amid ongoing concerns over subscriber churn and subsidiary losses.
