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Indiamart Intermesh Ltd.

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ABOUT

  • Founded in 1999 IndiaMART is India’s largest online B2B marketplace, connecting buyers with suppliers.
  • With 60% market share of the online B2B Classified space in India, the channel focuses on providing a platform to Small & Medium Enterprises (SMEs), Large Enterprises as well as individuals.
  • IndiaMart operates in various business sectors which include Building& Construction, Industrial Machinery, Apparel & Garments, Electronics & electrical, Industrial Supplies, Furniture Supplies and many more.
  • It has 82.70 + million buyers, 5.55+ million sellers and 60.73+ million product and services. The company’s mission is ‘to make doing business easy’.

 

BUSINESS STRATEGY

  • Continue to increase the size of IndiaMART marketplace - The Company’s major strategy is to focus on their non-paying and paying supplier acquisition and customer service efforts which will help them expand their marketplace. The company also believes that its marketplace for the discovery of products and services is highly scalable. Last but not the least the company aims at leveraging growth in mobile penetration to increase their reach to people.
  • Attract larger suppliers and leading brands while growing their core SME segment supplier base - IndiaMART seeks to make itself an engaging and effective marketplace for the larger corporate and leading brand suppliers while sustaining the efforts to grow strong SME supplier base.
  • Enhance our buyers’ experience - Concentrating on their mission IndiaMart continues to enhance buyers’ experience by providing them with a comprehensive discovery platform backed by a suite of products and services offered by a large number of suppliers that includes large brands. IndiaMart tries to improve the quality and completeness of product and service information on their marketplace listings, including price, photos, and videos to help buyer’s shortlist the appropriate suppliers easily.
  • Improve supplier engagement, services, retention, and monetization - IndiaMART tries to have maximum engagement with its suppliers, which includes Indian SMEs and large businesses. IndiaMart regularly work on improving its management systems and further personalize their suppliers’ experiences so that the platform turns out to be advantageous for marketing their products and services.
  • Continue investing in our mobile platforms and capabilities - Based on KPMG reports the number of internet subscribers is projected to increase 867 million by fiscal 2022 which will continue to drive the growth of online commerce in India. IndiaMart intends to further encourage the use of mobile platforms by suppliers and buyers through targeted marketing initiatives. It also aims at offering innovative and effective solutions such as integrated voice search, and encourages the buyer to use mobile platforms to upload their Request for quotation (RFQs).

 

INITIAL PUBLIC OFFER (IPO)

Bid/Offer Opens On June  24,2019
Issue Type Book Building Issue IPO
Bid/Offer Closes On June  26,2019
Issue Price Rs 970-973
Issue Size 475.59 Cr
Face Value Rs 10 per Equity Share
Market Lot 15
Listing At NSE,BSE

 

PROMOTERS

  • DINESH CHANDRA AGARWAL
  • BRIJESH AGRAWAL

SHAREHOLDING PATTERN

Name of Shareholders

Number of Equity Shares Percentage of Share Capital(%)
Dinesh Chandra Agrawal 9,483,200 38.37
Brijesh Agrawal 6,426,200 26.00
Intel Capital (Mauritius),Limited 2,076,291 8.40
Accion Frontier Inclusion Mauritius 950,668 3.85
Madhup Agrawal 793,000 3.21
Westbridge Crossover Fund, LLC 597,034 2.42
Amadeus EIII LLP 597,014 2.42
Dinesh Gulati 529,500 2.14
Vikas Aggarwal 211,920 0.86
Amadeus IV DPF Limited 170,502 0.69
Others   11.66
Total   100

 

INDUSTRIAL ANALYSIS

  • Sectorial composition of GDP (%)
Sector 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18
Agriculture & allied activities 17.8 17.8 16.5 15.4 15.3 14.6
Industry 22.7 22.3 22.5 23.7 23.7 22.8
Manufacturing 17.4 17.2 17.3 18.1 18.2 17.8
Services 59.5 59.9 61.0 61.3 61.1 62.3

 

INTERNET GROWTH IN INDIA

The number of internet subscribers in India is expected to increase from 446 million as on December 2017 to nearly 900 million by FY22 primarily driven by growth in wireless broadband services.Wireline broadband services are expected to grow at a comparatively gradual rate due to constraints around high initial investment in deployment of fixed line infrastructure and increased user preference to use internet on the go.

THE MSME MARKET IN INDIA

  • Growth of MSMEs

(Figures in Millions)

  2015-16 2006-2007 Growth Rate(%)
No. of MSMEs 63.39 36.18 6.43
Manufacturing 19.67 11.50 6.14
Services 43.72 24.68 6.56

 

  • Share of MSME sector in GDP(%)

(Figures in Millions)

  2011-12 2012-13 2013-14 2014-15
MSME contribution to Manufacturing 6.16 6.27 6.27 6.11
MSME contribution to Services 23.81 24.13 24.37 24.63

  • Year on Year Revenue growth

GLOBAL ADVERTISING TRENDS – THE SHIFT TOWARDS DIGITAL ADVERTISING

  • Global % share of advertisement spend-Increase in digital spend

  • Spends on Digital advertising (INR billion)

THE INDIAN CLASSIFIEDS MARKET

The digital classifieds market in India is a combination of horizontal and vertical players. The horizontals offer listing across a host of goods and services, ranging from real estate, home services, pet care, used goods to medical suppliers. On the other hand, the vertical players focus on a single product/service category such as matrimonial, recruitment services etc.

  • Growth of digital classifieds (2017-2022F)

  • Category distribution of digital classifieds(FY2017 vs FY2022)

  • Growth in B2B digital classified(FY2017-FY2022)

E-COMMERCE IN INDIA (INR BILLION)

  • Percentage of online SMEs using E-commerce

  • Number of suppliers on a select B2B e commerce platforms
B2B platform No. of users No. of suppliers
Indiamart 59.8 million 4.7 million
Trade India 4.3 million NA
Industry Buying NA 5,000-6,000
Moglix NA ~2,000

 

  • Growth in number of paying customers for IndiaMart

COMPANY ANALYSIS

FINANCIAL OVERVIEW

(Figures in Millions)

Year

Total Revenue

Rate of Change Total Assets Rate of Change Total Expenses Rate of Change
2016 2,510.09   1946.46   3,821.22  
2017 3,319.36 32.24 2,209.06 13.49 3,960.80 3.65
2018 4,295.26 29.4 5,427.13 145.67 4,896.23 23.62
  • Total Revenue

  • Total Assets

  • Total Expenses

STATISTICAL OVERVIEW

The following table and graph shows the return on equity and earning per share between 2016 to 2018 :

Year RONW(%) EPS(Rs)
2016 40.23 71.75
2017 16.50 35.04
2018 17.04 28.60

REFERENCES

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