Info Edge (India) Ltd is Rated Sell

Rating Overview and Context

On 01 July 2025, MarketsMOJO revised its rating on Info Edge (India) Ltd from 'Hold' to 'Sell', reflecting a significant change in the company’s overall assessment. The Mojo Score, a composite indicator of various performance parameters, declined by 16 points from 64 to 48, signalling a more cautious stance on the stock. This rating encapsulates a comprehensive evaluation of the company’s quality, valuation, financial trends, and technical outlook.

Here’s How Info Edge Looks Today

As of 28 December 2025, Info Edge (India) Ltd is positioned as a large-cap player in the E-Retail and E-Commerce sector. Despite its market stature, the stock has experienced a challenging year, with a 1-year return of -21.19%, underperforming the broader BSE500 index, which delivered a positive 5.76% return over the same period. This divergence highlights the stock’s relative weakness in the current market environment.

Quality Assessment

The company’s quality grade remains classified as good. This reflects a stable operational foundation and sound business practices. Info Edge has demonstrated resilience in its core operations, supported by a return on equity (ROE) of 2.7%. While this ROE is modest, it indicates the company is generating some shareholder value, albeit at a lower level compared to more aggressive growth peers.

Valuation Considerations

Valuation is a critical factor in the current rating. Info Edge is deemed very expensive with a price-to-book (P/B) ratio of 1.8. This elevated valuation suggests that the market has priced in significant growth expectations. However, the stock is trading at a discount relative to its peers’ historical valuations, which may offer some cushion. The price-earnings-to-growth (PEG) ratio stands at 0.5, indicating that despite the high price multiples, the company’s earnings growth potential is relatively attractive. This valuation complexity contributes to the cautious rating, as investors must weigh the premium against the company’s recent performance.

Financial Trend Analysis

Financially, Info Edge shows a positive trend. The company’s profits have surged by 151.6% over the past year, a remarkable improvement that contrasts with the stock’s negative returns. This disparity suggests that the market has not fully rewarded the company’s earnings growth, possibly due to concerns about sustainability or broader sector challenges. The positive financial trend is a key factor supporting the stock’s potential, but it is tempered by valuation and technical factors.

Technical Outlook

The technical grade for Info Edge is mildly bearish. This suggests that recent price movements and chart patterns indicate some downward pressure or lack of strong momentum. The stock’s short-term performance shows mixed signals: a slight decline of 0.01% on the latest trading day, but modest gains over one week (+1.83%) and one month (+1.88%). However, the six-month return is negative at -9.99%, reinforcing the cautious technical stance.

Stock Returns and Market Comparison

Examining returns in detail, the stock’s year-to-date (YTD) performance is -21.51%, closely aligned with its 1-year return of -21.19%. This underperformance relative to the broader market index highlights the challenges faced by Info Edge in regaining investor confidence. Despite the company’s strong profit growth, the stock price has not reflected this improvement, possibly due to concerns about valuation and sector dynamics.

Implications for Investors

The current Sell rating from MarketsMOJO indicates a cautious approach for investors considering Info Edge (India) Ltd. While the company exhibits positive financial trends and maintains good quality fundamentals, the very expensive valuation and mildly bearish technical signals suggest limited upside potential in the near term. Investors should carefully weigh these factors against their risk tolerance and investment horizon.

For those holding the stock, the rating advises prudence and consideration of portfolio rebalancing. Prospective investors might prefer to monitor the stock for signs of valuation correction or technical improvement before initiating new positions.

Summary

In summary, Info Edge (India) Ltd’s current Sell rating reflects a balanced assessment of its strengths and weaknesses as of 28 December 2025. The company’s good quality and positive financial trends are offset by a very expensive valuation and a mildly bearish technical outlook. The stock’s underperformance relative to the broader market further supports a cautious stance. Investors should consider these factors carefully when making decisions regarding this stock.

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