My brief analysis.
https://investeek.com/stocksindia/info-edge/
Disclosure - invested
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Google’s investment (if it materializes) will be a big validation of Policy Bazaar’s model and runway. Info Edge stock will jump too.
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Market probably partially factored news 
Given recent QIP, Infoedge may as well be an investor in this pre-listing round. Given superb tailwinds to policybazaar in current scenario.
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On Aug 7 2020, QIP happened at 3090, yet the stock is trading at 3200+ - fail to understand why
Was trying to understand - In case there is a Zomato IPO, how does it benefit Info edge share holders?Whether there would be any preferential allotment to info edge share holders.?
Anyway, Info edge is an intersting stock which I wanted to buy…as it provides all essentials men need in life with the help of digital technology…
(1) After your Graduation , you need a job. Take help from naukri.com
(2) After some time you want to get married. Take help from jeevansathi.com
(3) Now you need a house, 99.acres.com
(4) You want food to live … Zomato.com
(5) Now protect your life. policybazzar.com
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Quess corp entering into direct competition in blue collar segment, Naukri is too experimenting with this segment in recent past, interesting point being blue collar market size is much bigger than white collar jobs. Quess is already running monster job after acquisition and that doesn’t seem to make a dent in naukri monopoly yet.
This is a very important development. It signifies lot of aspects:
- Others trust Infoedge Investment skills and are comfortable with handing over funds to them.
- It will create a new revenue stream for InfoEdge.
- Through access to outside funds InfoEdge has a larger pool of funds to deploy giving it entry to larger deals.
- InfoEdge with it’s own limited funds will now also be able to co-invest which it wasn’t able to.
- This can be the beginning of an entirely new chapter in the InfoEdge story.
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fundraise by Zomato, valued now at $4b, Infoedge stake is at 19.5% post dilution.
In a recent tweet Devindar goyal, he indicated Zomato is geared for 25% plus growth over pte covid levels at GMV.
In recent fundraise they have provided exit by buybacks to employees etc, this is akin to good corp governance practice of buyback and adds to mgmt confidence on delivering better returns in near future.
With the crazy IPO valuations of recent past IPOs and dearth of supply of good consumer tech platform stocks in India( should they choose to list in India and believe they will ), valuations from current level could still grow meaningfully from where they are to IPO journey due in 2021.
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Any idea if it falls under parent entity or is it a private entity setup for VC funding?
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To those who are invested in info edge, could you please help explain what justifies its valuation at over 50 times revenue?
Havent found anything in the thread that seems to justify a price of 50x revenue, surely am missing something?
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Personally I feel, the only reason is coz of Zomato.
Info Edge has 19.3% stake in Zomato. No that there is no clarity on Zomato IPO, price seems to be falling.
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Another invested company (by Info edge) is Policybazar., which I feel will be more valuable than Zomato. Also it is interesting to note that all current investors (including Info edge) have decided not to divest their stakes in Zomato . This means they see more value in Zomato than what the IPO valuation. This is a big plus for anyone applying for the Zomato IPO
In nutshell, Info edge’s value is more due to various companies it has invested in , rather than its own businesses like Naukari.com. Hence Info edge need to be treated like micro Berkshire Hathway…
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Infoedge market cap is Rs 63000 crore+
If Zomato is valued at $5.4 Bn then Infoedge value of 19.3% stake is ~$1 Bn or INR 7300 Cr.
If Policybazaar is valued at $3.5 Bn, then Infoedge value of 19% stake is $0.66 Bn or INR 4800 Cr.
Combined thats INR 12100 Cr.
That leaves another INR 50900 Cr valuation gap to be fill-in by the following sites:
Naukri.com, jeevansathi.com, 99acres.com, Shikha.com
and all the invested sites listed here:
Info Edge (India) Limited
- https://www.meritnation.com
- https://www.mydala.com
- https://www.happilyunmarried.com
- https://www.canvera.com
- https://www.vacationlabs.com
- http://www.bigstylist.com (site doesn’t even open)
- https://bluedolph.in
So do you feel these are all worth 50000 Cr + or not is the question.
Am skeptical.
Sources:
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Update on Zamato IPO. Company planning to file for an IPO by next month.
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makes no sense to invest at $8.3b (everything is more than factered in stock price)
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