Bernstein's Bullish Outlook on Info Edge
Info Edge India, the parent company of job portal Naukri.com and real estate platform 99 Acres, has received a positive review from brokerage firm Bernstein. The firm upgraded its price target for Info Edge to ₹7,940, suggesting a potential 10% upside from its current levels. This optimism is largely driven by the company's performance in its recruitment and real estate segments.
Recruitment Segment Drives Growth
Naukri, a key player in the recruitment industry, reported a 9% year-on-year increase in billings. This growth is largely attributed to a surge in hiring within the Gulf Cooperation Council (GCC) and consulting sectors. The hiring recovery in the IT industry is particularly noteworthy, as it significantly boosts Naukri’s performance. Recruitment billings are expected to continue improving, providing a strong foundation for Info Edge’s growth.
Real Estate Segment's Strong Performance
Info Edge's real estate arm, 99 Acres, also showed impressive results with a 19.5% surge in revenue compared to the previous year. This increase reflects a stabilization in the housing market, which is poised to benefit 99 Acres further. As the real estate market stabilizes, more opportunities arise for growth and expansion, thereby enhancing Info Edge’s market position.
Investment Portfolio and Market Catalysts
While the valuation of Info Edge's startup investments such as Zomato and Policybazaar has been adjusted downward, the company’s overall investment portfolio remains robust. The recovery in IT billings and strong performance in core segments like recruitment and real estate are key catalysts propelling the stock forward. Analysts expect these factors to continue driving Info Edge’s stock performance positively.
Conclusion
Bernstein's analysis suggests that Info Edge has a promising outlook due to its strong recruitment and real estate segments, as well as the potential growth of its investment portfolio. The company’s ability to capitalize on market recoveries and stable sectors positions it well for future growth, justifying Bernstein's optimistic stance and revised price target.
