IndiaMART shares fell more than 5% on Wednesday after the company reported its June quarter results, with the stock crashing 5.1% to ₹1,820 in afternoon trade. According to Moneycontrol, the stock is down 17% so far in 2026, underperforming the Nifty 50, which has declined 8.2% over the same period. Despite the strong financial performance, brokerages remained cautious over the continued decline in the paid supplier base, with Jefferies retaining its Underperform rating with a target price of ₹1,650 and Nomura maintaining its Reduce rating with a target price of ₹1,810. The brokerages highlighted the decline in paid suppliers for a third consecutive quarter as the key negative, with Jefferies cutting its FY28-FY29 earnings per share estimates by around 1.5-4%.
Online B2B e-commerce company IndiaMART InterMESH reported robust financial results for the first quarter of FY27, with consolidated net profit increasing 12.2% year-on-year to ₹172 crore compared to ₹153.5 crore in the corresponding period last year. According to latest reports, the company also achieved a 243.03% quarter-on-quarter increase in net profit. Revenue from operations rose 11.4% year-on-year to ₹414.4 crore, up from ₹372 crore in the previous year, while also showing a 2.50% quarter-on-quarter growth. On a standalone basis, the company reported revenue of ₹376 crore, up 9% from ₹346 crore in the corresponding quarter last year. EBITDA increased 9.7% year-on-year to ₹146.5 crore, though EBITDA margin edged lower to 35% from 36% a year ago. Other income rose to ₹107 crore from ₹92 crore in the same period last year.
The company's growth was primarily driven by improved realisation from paying suppliers, as reported by Business Standard. Customer collections from the standalone IndiaMart business rose 8% year-on-year to ₹402 crore, marking the slowest growth in five quarters - a significant deceleration from the 10-17.5% growth rates seen in each of the previous four quarters. Deferred revenue as of June 30, 2026 increased 14% to ₹1,858 crore, comprising ₹1,858 crore from IndiaMART's standalone business. The Busy Infotech contributed ₹36 crore in revenue during the quarter. The strong performance was particularly notable in web and related services, which contributed significantly to the overall revenue growth. Revenue from web and related services was ₹375.9 crore, and ₹38.5 crore from accounting software services during the quarter.
According to Business Standard, during the quarter, IndiaMART recorded 26 million unique business enquiries. Supplier storefronts increased 5% year-on-year to 8.8 million, while the number of paying suppliers stood at 218,000 at the end of the quarter. The company generated ₹163 crore in cash flow from operations during the quarter and maintained a cash and investments balance of ₹3,553 crore as of June 30, 2026. Average revenue per paying subscriber (ARPU) increased to ₹69,000, up 7.8% from a year earlier, supported by improved realisation from paying suppliers. However, buyers and unique business enquiries fell 5% and 10% year-on-year respectively as management focused on improving buyer quality and monetisation categories.
Despite the strong financial performance, brokerages flagged continued concerns over the decline in paid suppliers for a third consecutive quarter as the key negative factor. Jefferies noted that margin expansion was driven by lower customer acquisition costs, which it expects to normalise, while weak subscriber additions could weigh on the platform's network effects. The brokerage also highlighted that meaningful growth in the paid subscriber base will be necessary for further upside in the stock. Nomura maintained its Reduce rating, valuing IndiaMart's core business at 18 times price-to-earnings, emphasizing that product evolution will be critical to revive subscriber additions and that meaningful growth in the paid subscriber base will be necessary for further upside.
