Recently, Info Edge, one of the oldest internet companies in India, has hit a market cap of $10 billion. It happened after its share value doubled in the last year. Surprisingly, Info Edge profit is continuously declining for the last 5 quarters.
The rise in Info Edge Market Value
Currently, digital company Info Edge share has become a hot cake. Its valuation is increasing every day. The main reason behind the Info Edge share growth is the investment of this digital company in known unicorns Zomato and Policy Bazaar. Analysts predict a further rise in Info Edge share due to IPO (initial public offering) beginning of Zomato and Policy Bazaar both in 2021.
Zomato will start its IPO within 3 months. There are other reasons as well related to the surge in Info Edge value. Info Edge has 4 major businesses right now. First, they have a well-known recruitment portal Naukri.com that is growing rapidly. Second, it has a real estate startup 99acres.com. it provides better land deals to its users. Third, they have a matrimony service jeevansathi.com. fourth, they have started an edtech vertical named shisha.com.
The Indian government also recognized the Info Edge contribution to the internet economy of India. Sanjeev Bhikchandani, the founder of Info Edge, received Padam Shri for his exemplary services in the field of information technology. He received this award last year in January.
Reasons Behind Info Edge Growth
Analysts consider the Info Edge company as the future-oriented firm. It takes the advantage of the only digital listed company in India.
Wealth Mills Securities Strategist said:
“We don’t have a completely digital listed company in India and Info Edge is the only representative as far as the digital age is concerned. That’s why there is exuberance from institutional investors, ”
People are so excited to invest in Info Edge that they forgot the profit decline in the firm from last 5 quarters. WealthMills Spokesperson further said:
“Info Edge has a unique business model and when you talk about the double-digit GDP growth that India is aiming for, these are the kind of companies that will give tremendous returns,”
ICICI securities believe that the company share will further go up with improved revenue due to the economy open up after lockdown.
Info Edge earns maximum revenue from naukri.com. but the current pandemic saw a decline in jobs so it did not do well. On the other hand, the real estate business has seen the worst phase. And it has affected 99acres.com business badly.
Info Edge is not fully dependent on its business. The company’s strategic investments have also added value to its portfolio. The company will earn a huge benefit from the IPOs of Zomato and Policy Bazaar. Info Edge has a stake of 20% in online food delivery giant Zomato.
In a recent interview with Business Insider, Info Edge CEO Hitesh Oberoi said:
“We had invested in Zomato when it wasn’t even called so. It was called Foodiebay then. When we had started investing, there was no SoftBank (Japanese investment firm) – we were in the mindset to start investing in businesses that we understand.”
Info Edge is also increasing its portfolio with some acquisitions. A few days back, it has acquired 4B Networks, a platform for brokers and builders. Analysts believe that Zomato and Policy Bazaar will turn into gold for the investors. Being a noted investor, Info Edge will benefit a lot.