Infibeam Avenues Q1 Results Review - Robust Net Take Rates; FY25 Guidance Retained: Dolat Capital

Dolat Capital Report

Infibeam Avenues Ltd. posted revenue growth of 3.6% QoQ (our estimate 5% organic). Payments Biz grew 5.2% QoQ, while Platforms Biz. down 15.9% QoQ. Total Payment Volume was at Rs 719 billion, down 5.2% QoQ and Credit Card mix lowered to 46% (Q4: 50%). Operating profit margin was up 17 bps QoQ at 6.8% (our estimate 5.5%) led by better Net Take Rates, which stood at 11.2 bps (Q4: 9.2 bps).

For FY25, the company retained its guidance for sales of ~Rs.39-42 billion (implies 23-32% growth), Ebitda of ~Rs 2.75-Rs 3 billion (9-19% growth) and profit after tax of ~Rs 1.75-2 billion (12%-28%).

Infibeam remains bullish on the growth of payments biz. (India and International) and its profitability.

We raise earnings by 12.5%/5% for FY25/FY26E and expect the company to benefit from growing trend of online credit card spends and tech spends by Indian banks.

Maintain ‘Accumulate’ rating with a discounted cash flow based target price of Rs 37 (implies enterprise /Ebitda of 24 times and PER of 47 times on FY26E).

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