Current Rating and Its Implications
MarketsMOJO's 'Sell' rating on Indiamart Intermesh Ltd indicates a cautious stance for investors considering this stock. This recommendation is based on a comprehensive evaluation of four key parameters: Quality, Valuation, Financial Trend, and Technicals. The rating was revised on 24 Nov 2025, reflecting a significant change in the company's outlook, but the data and analysis presented here are up to date as of 27 December 2025, ensuring relevance for current investment decisions.
Quality Assessment
As of 27 December 2025, Indiamart Intermesh Ltd maintains a good quality grade. This suggests that the company exhibits solid operational fundamentals and a stable business model within the e-retail and e-commerce sector. However, despite this positive quality assessment, the company’s long-term growth has been modest. Operating profit has grown at an annual rate of 16.82% over the past five years, which is moderate but not robust enough to drive a more favourable rating.
Valuation Considerations
The valuation grade for Indiamart Intermesh Ltd is currently very expensive. The stock trades at a price-to-book value of 6.2, which is considerably high, especially when compared to its peers. This elevated valuation implies that the market has priced in significant growth expectations. However, the latest data shows that while the company’s profits have risen by 24.9% over the past year, the stock has delivered a negative return of -0.88% during the same period. This disparity between valuation and returns raises concerns about the stock’s price sustainability.
Financial Trend Analysis
The financial trend for Indiamart Intermesh Ltd is assessed as flat. The company reported flat results in the quarter ending September 2025, with a notable decline in key profitability metrics. The quarterly PAT stood at ₹82.70 crores, falling by 44.0% compared to the previous four-quarter average. Additionally, the PBDIT for the quarter was at a low of ₹129.70 crores. The debtors turnover ratio for the half-year was also at a low 33.47 times, indicating potential challenges in receivables management. These factors collectively suggest a lack of strong financial momentum, which weighs on the stock’s outlook.
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- - Fundamental Analysis
- - Technical Signals
- - Peer Comparison
Technical Outlook
The technical grade for Indiamart Intermesh Ltd is bearish. The stock’s recent price movements reflect a downward trend, with a one-month decline of 5.17% and a six-month drop of 15.76%. The one-day change as of 27 December 2025 was -0.57%, indicating continued selling pressure. Over the past year, the stock has underperformed the BSE500 index, delivering a negative return of -0.88%. This technical weakness suggests limited near-term upside potential and increased risk for investors.
Stock Returns and Market Performance
Currently, the company’s stock returns show a mixed picture. While the year-to-date return is slightly negative at -1.34%, the stock has experienced a modest recovery in the past week with a +0.02% change. However, the longer-term returns remain subdued, with a three-month decline of 6.18% and a one-year return of -0.88%. This performance indicates that the stock has struggled to generate meaningful gains relative to the broader market and its sector peers.
Profitability and Efficiency Metrics
The company’s return on equity (ROE) stands at a strong 25.2%, which typically signals efficient use of shareholder capital. Despite this, the high valuation and flat financial trend temper enthusiasm. The PEG ratio is currently 1, suggesting that the stock’s price is aligned with its earnings growth, but given the flat financial trend and bearish technicals, this alignment does not translate into a positive investment outlook.
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Investor Takeaway
For investors, the 'Sell' rating on Indiamart Intermesh Ltd signals caution. Despite the company’s good quality and strong ROE, the very expensive valuation combined with flat financial trends and bearish technical indicators suggest limited upside potential. The stock’s recent underperformance relative to the broader market and peers further supports a conservative stance. Investors should carefully weigh these factors and consider alternative opportunities within the e-commerce sector or broader market that offer more favourable risk-reward profiles.
Summary
In summary, Indiamart Intermesh Ltd’s current 'Sell' rating by MarketsMOJO, updated on 24 Nov 2025, reflects a comprehensive assessment of its present fundamentals as of 27 December 2025. The company’s good quality is overshadowed by its very expensive valuation, flat financial performance, and bearish technical outlook. These combined factors justify the cautious recommendation, advising investors to approach the stock with prudence in the current market environment.
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