Info Edge shares zoom 5% after Zomato raises another $250 million

Info Edge shares, on Tuesday, surged 5 per cent to Rs 5,250 in intra-day deals on the BSE after food delivery giant Zomato raised another $250 million in primary fundraise from existing and new investors. Info Edge, the nation’s leading job-hunting platform, also has investments in at least 23 startups, including Zomato.

In a stock exchange filing, Info Edge said that the latest transaction has taken the post-money valuation of Zomato to $5.4 billion. This is an increase from its previous valuation of $3.9 billion in December last year when it closed a $660 million primary financing round.

“On a fully converted and diluted basis, Info Edge’s effective stake in Zomato stands at 18.4 per cent,” Info Edge said in the stock exchange filing.

Five investors have backed the Gurugram-based unicorn in the new funding round. Existing investors Kora invested $115 million, Fidelity invested $50 million and Tiger Global injected $50 million. Other investors Bow Wave invested $20 million and Dragoneer put in $10 million in the company.

At 9:55 AM, Info Edge's stock was up 1.68 per cent at Rs 5,079.15 as compared to 0.1 per cent gain in the S&P BSE Sensex. A combined 3.9 lakh shares have changed hands on the NSE and BSE so far

On February 12, Info Edge had reported a 22.7 per cent on year decline in standalone net profit at Rs 69.87 crore along with a 15 per cent fall in net sales at Rs 272.30 crore in Q3FY21 over Q3 FY20.

Billing in the third quarter was at Rs 297 crore, down by 1 per cent as compared to the corresponding quarter in FY20. The deferred sales revenue (amount collected in advance) as on 31 December 2020 was Rs 393.5 crore, down by 13.9 per cent over the quarter ended 31 December 2019. Operating Ebitda declined by 35.6 per cent to Rs 68.2 crore in Q3FY21 from Rs 105.9 crore in Q3FY20.

Profit before tax in the quarter also slipped 21.4 per cent YoY to Rs 87.45 crore from Rs 111.24 crore in Q3FY20.

Analysts at JM Financials believe that while the upcoming listing of investee companies continue to support near-term stock momentum, valuation appears to be stretched which limits constructive case. The brokerage has 'Hold' rating on the stock with a target price of Rs 4,980. On similar lines, analysts at Edelweiss Securities have 'Hold' rating on the stock with a target price of Rs 5,460 considering the core business's steep valuation.

Meanwhile, foreign brokerage CLSA maintained its 'Outperform' rating on the stock with a revised target price of Rs 5,740 from Rs 3,580 to factor in an improved long-term growth outlook and to capture higher valuation for its stake in Zomato and Policybazaar.