IndiaMART Doubles Profit In Q2 FY25 Results

IndiaMART's strong revenue growth and controlled expenses drive a significant rise in profit.

IndiaMART InterMESH, a leading B2B marketplace, reported a sharp rise in its consolidated net profit for the second quarter of FY25, more than doubling its profit to INR 135.1 crore compared to INR 69.4 crore in the same period last year.

The company’s impressive performance was backed by robust revenue growth and tight control over expenses.

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IndiaMart Performance

IndiaMART’s net profit grew by over 18% on a quarter-on-quarter basis, up from INR 114 crore in the previous quarter (Q1 FY25).

Revenue from operations also saw a significant increase, rising 18% year-on-year to INR 347.6 crore in Q2 FY25, compared to INR 294.6 crore in the corresponding quarter last year.

Sequentially, the company’s revenue climbed 5% from INR 331.3 crore in Q1 FY25.

IndiaMART’s earnings before interest, taxes, depreciation, and amortization (EBITDA) surged 68% year-on-year, reaching INR 135 crore in Q2 FY25, showcasing strong operational efficiency.

Customer collections grew 6% year-on-year to INR 356 crore, which includes standalone collections of INR 337 crore and collections from its subsidiary, Busy Infotech, amounting to INR 16 crore.

The company also noted significant growth in business inquiries and supplier activity.

It registered 28 million unique business inquiries in Q2 FY25, reflecting a 14% year-on-year increase, while supplier storefronts grew 5% to 8 million.

Additionally, the number of paying suppliers rose 4% to 218,000, with annualized revenue per paying supplier up 14% year-on-year to INR 61,000.

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IndiaMART’s performance reflects the growing demand for digital B2B platforms in India.

The company continues to capitalize on the increasing digitization of small and medium enterprises (SMEs), which is driving growth in both buyer and supplier engagement on its platform.

Despite a highly competitive environment, IndiaMART’s ability to increase customer collections and maintain robust growth in inquiries indicates sustained demand for its services.

Deferred revenue, which represents revenue yet to be recognized, also saw a 19% year-on-year jump to INR 1,483 crore.

This includes standalone deferred revenue of INR 1,426 crore and Busy Infotech’s deferred revenue of INR 53 crore, pointing to strong future revenue potential.

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IndiaMART’s management outlined its plans to focus on its core SME business while continuing to expand its buyer and supplier network.

The company is also set to enhance customer engagement by investing in fintech, accounting, and SaaS (Software-as-a-Service) business solutions to improve the overall user experience on its platform.

Regarding expenses, IndiaMART reported a marginal decrease in total expenditures, which dropped slightly to INR 223.1 crore in Q2 FY25 from INR 225 crore in the same period last year.

Employee benefit expenses rose by 10% to INR 147.4 crore, while finance costs fell by 27% to INR 1.8 crore, showing improved cost management. Other expenses also dropped by over 4% to INR 65.7 crore.

Conclusion

IndiaMART’s stellar Q2 FY25 performance, driven by solid revenue growth and controlled costs, has positioned the company for continued success in the digital B2B space.

Its focus on expanding its core SME business and boosting customer engagement through technology investments will likely keep driving growth in the upcoming quarters.

Despite a minor dip in share price ahead of the results, IndiaMART’s strong fundamentals suggest a positive outlook for the future.