In fact, recent reports on fund raising by Zomato, which Info Edge has denied, underlines the growth potential of the online food aggregator. An analyst at a domestic broking house believes the fresh investments in Zomato
point to higher valuation for Info Edge too.
Besides, Info Edge’s key recruitment business (naukri.com), which made up over 70 per cent of its revenues in FY19, is also likely to report a good performance, improving the company’s cash flow outlook. As per Info Edge’s FY19 annual report, naukri.com's impressive performance over the years has helped the firm build solid cash reserves. Though there are growth worries for Info Edge’s real estate business (99acres.com) due to weak sentiment in the sector, given the better performance of these standalone businesses (naukri.com and 99acres.com), analysts aren’t too worried.
“We remain positive on Info Edge, as the company has delivered superior growth and better margins even when market conditions for recruitment and real estate businesses have been poor,” analysts at JM Financial said in their recent note.
Further growth levers include increasing internet penetration in rural and urban areas and rising preference for digitisation. Overall, many analysts believe Info Edge is a good bet for long-term investors.