Indiamart Intermesh Limited

IndiaMART reported a consolidated revenue from operations of Rs. 402 crores in Q3 FY26, marking a 13% year-on-year growth. Collections from customers also saw robust growth, increasing by 17% year-on-year to Rs. 426 crores. The company's deferred revenue grew 19% year-on-year to Rs. 1,775 crores. Consolidated EBITDA for the quarter stood at Rs. 134 crores, representing a 33% margin, while net profit reached Rs. 188 crores.

Busy, IndiaMART's accounting software subsidiary, recorded a billing of Rs. 33 crores in Q3 FY26. Its normalized year-on-year growth rate, after adjusting for payout structure changes, was 28%. Revenue from operations for Busy was Rs. 32 crores, showing a 50% normalized growth, and deferred revenue was Rs. 112 crores, growing 56% normalized. Busy sold approximately 10 thousand new licenses during the quarter, bringing its total licenses sold to 431 thousand.

The total number of paying suppliers experienced a slight decline of 1 thousand, settling at 221 thousand. This decrease was primarily attributed to a moderation in gross additions following a price increase in the silver subscription tier and fewer working days due to the festival season. Unique business inquiries reached 28 million, growing 4% year-on-year, which indicates a slowdown compared to previous quarters' growth rates of 17% and 12%.

IndiaMART continues its journey as an early adopter of new technologies, rapidly integrating AI-enabled solutions to enhance product quality, user experience, and trust. The company believes that the emergence of new technologies like AI expands the total addressable market (TAM). Management is actively focusing on improving repeat traffic, which currently stands at an all-time high of 58-59%, as a key strategy to navigate evolving search behaviors.

A significant price increase was implemented in the silver subscription tier, raising the monthly rate from Rs. 3,000 to Rs. 4,000 and the annual rate from Rs. 28,500 to Rs. 32,000 (after discount). Management acknowledged that this steep hike might lead to some churn among 'fence-sitters.' The full impact of these price changes on renewals and overall churn is expected to become clear in the next six to nine months.

The company's ARPU growth is currently aligning with its long-term trend of 6-8%, with top 10% customer ARPU growing at 9-11%. IndiaMART aims for an overall growth rate exceeding 20%, targeting a balanced contribution of 10% from customer additions and 10% from ARPU expansion. This strategy emphasizes balancing both top-line growth and profitability, leveraging higher-tier customers (Platinum and Gold) who contribute over 75% of revenue and maintain good upsell and retention rates.

Consolidated Other Income for the quarter included a one-time^📎 fair valuation gain of approximately Rs. 82 crores, resulting from the revaluation of the strategic investment in Baldor Technologies. Additionally, the company incurred a one-time^📎 impact of Rs. 8.5 crores on its P&L due to the implementation of a new labor code, which was mandated by ICAI.