25 July 2016

Results Update | Sector: Technology

Info Edge India

BSE SENSEX S&P CNX CMP: INR871 TP: INR1,000(+15%) Buy 28,095 8,636 Bloomberg INFOE IN Equity Shares (m) 121.0 M.Cap.(INRb)/(USDb) 105.3 / 1.6

52-Week Range (INR) 906 / 690 1, 6, 12 Rel. Per (%) 3/-6/-2 12M Avg Val (INR M) 77 Free float (%) 56.9 Financials & Valuations (INR b) Y/E Mar 2016 2017E 2018E

Net Sales 7.2 8.4 9.9 EBITDA 1.6 2.2 3.0 NP 1.6 2.1 2.7 EPS (INR) 13.0 17.2 22.1 EPS Gr. (%) -5.3 32.8 28.3 BV/Sh. (INR) 145.3 154.2 169.7 RoE (%) 9.2 11.6 13.7 RoCE (%) 9.2 11.5 13.6 Payout (%) 59.3 44.6 34.8 Div. Yield 5.3 5.0 4.5

Estimate change TP change Rating change

Profitability resurrection tracking well Gulf and real estate result in lower revenue: INFOE’s 1QFY17 revenue grew

13% YoY to INR1.98b, below our estimate of 15.8% growth, led by a miss in Recruitment and 99acres.com. Recruitment segment grew 14% YoY to INR1.26b, compared to our estimate of 16.4% growth because of weakness in Gulf. 99acres.com grew by 2.8% YoY to INR279m, below our estimate, led by continued sluggishness in the real estate market. Although 99acres.com is gaining share in terms of traffic, it isn’t translating into revenue growth.

Profitability above estimates: EBITDA margins improved by 1,080bp YoY to 24.2%, led by lower ad spends, resulting out of reduced competitive intensity in 99acres.com. The transition to IND-AS negatively impacted by margins by ~50bp. Factoring for this, EBITDA margins would beat our estimate.

Outlook on businesses: Growth in recruitment should remain strong in the domestic business. There are early signs of hiring cooling off in IT and start-ups. However, it’s too early to be called out as a trend. Real estate market remained under stress, a key hindrance to revenue growth and profitability of 99acres.com; that said, competitive intensity has eased. Jeevansaathi.com posted a profit after several years (INR6.5m). This was accompanied by strong revenue growth of 37% YoY. Zomato.com is trending well on delivering its target of double revenue and turning cash positive this year.

Valuation view: The slight miss in 1QFY17 revenue, and margin beat drive little change to our FY17/18 standalone earnings estimates, which are now at INR17.2/22.1. There have been signs in FY16 that INFOE’s strategy of matching aggression of competitors to sustain traffic and listings share is proving right, as the burn going forward reduces. We see Naukri.com (from pick-up in economic growth), 99acres.com (lowering competitive intensity) and Zomato.com (focus on driving monetization and profitability) as the key drivers of valuation at INFO. Our SOTP-based price target of INR1,000 implies 15% upside. Maintain Buy.

Quarterly Performance (Standalone)

Investors are advised to refer through important disclosures made at the last page of the Research Report. Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Ashish Chopra (Ashish.Chopra@MotilalOswal.com); +91 22 6129 1530 Sagar Lele (Sagar.Lele@MotilalOswal.com); +91 22 6129 1531

Motilal Oswal values your support in the Asiamoney Brokers Poll 2016 for

India Research, Sales and Trading team. We request your ballot.

Info Edge India

25 July 2016 2

1QFY17 Standalone revenues below estimates INFOE’s 1QFY17 revenue at INR1.98b grew 13.1% YoY, below our estimate of

INR1.99b (+15.8% YoY). Revenues from recruitment segment (naukri.com) grew 14% YoY to INR1.44b,

compared to our estimate of 16.4% YoY growth. 99acres.com posted revenues of INR279m, +2.8% YoY, compared to our

estimate of INR292m (+15.4% YoY). Other segments, including Jeevansathi.com posted INR258m, +20.8% YoY, above

our estimate of INR246m. Exhibit 1: YoY revenue growth traction a tad lower in standalone revenue

Source: Company, MOSL; *IND-AS

Profitability: Improvement led by lower ad spend EBITDA margins were in line with our estimate at 24.2%, +1,080bp YoY.

However, reporting in IND-AS resulted in a margin dilution of ~50bp on mainly account of fair valuation of ESOPs. If we were to look at margins barring this change, the reported margin would have been higher than our estimate.

The margin improvement has primarily resulted out of rationalization of advertisement expenses compared to last year. At the same time last year, heavy expenditure was made towards advertising and marketing because of increased competitive intensity in 99acres.com

PBT was INR661m, compared to our estimate of INR661m, because of higher Other Income and lower Depreciation expense. Consequently, PAT at INR444m was a tad lower than our estimate of INR469m.

1,208 1,236 1,234 1,380 1,449 1,476 1,457 1,731 1,747 1,741 1,734 2,042 1,976

13.9 14.6 15.9 18.9 20.0 19.4 18.1

25.4 20.6

18.0 19.0 18.0 13.1

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

Revenue (INR m) Revenue Growth - YoY (%)

Info Edge India

25 July 2016 3

Exhibit 2: EBITDA margins higher because of lower advertisement expense

Source: Company, MOSL; *IND-AS

Exhibit 3: PAT higher on a low base

Source: MOSL, Company; *IND-AS

Exhibit 4: Effect of transition to IND-AS in 1QFY16 (INRm)

IGAAP

Effects of transition to IND-AS IND-AS

Impact (%/bp)

Revenue from operations 1,718 29 1,747 2% Expenses 1,480 34 1,513 2% Employee benefit expenses 759 32 792 4% Advertising and promotion cost 461 - 461 0% Administration and other expenses 203 1 204 1% Network, internet and other direct charges 56 - 56 0% EBITDA 238 (4) 234 -2% EBITDA margin (%) 13.9%

13.4% -47bp

Depreciation 45 - 45 0% EBIT 193 (4) 189 -2% Other income 213 (20) 193 -10% Finance costs 0 - 0 0% PBT 406 (25) 381 -6% Tax expense 119 (23) 95 -20% PAT 287 (1) 286 0%

Source: MOSL, Company

369 442 423 434 493 422 363 544

234

334 385 623 478

30.5 35.8 34.3

31.5 34.0 28.6

24.9 31.4

13.4 19.2

22.2

30.5 24.2

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

EBITDA (INR m) EBITDA Margin (%)

294 333 322 336 398 332 386 530

287

339 377 572 444

-7.5 -0.2 4.6

-5.7

35.4

-0.1

19.9

57.8

-27.8

2.1 -2.5 7.9

54.3

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

PAT (INR m) YoY (%)

Info Edge India

25 July 2016 4

Takeaways from management commentary 99acres.com Revenues from 99acres.com grew by 2.8% YoY to INR279m. The real estate

market continues to be sluggish with weak demand for new homes in Mumbai, Gurgaon and Hyderabad. Unfinished projects, unsold inventory and lower transactions have been resulting in pressure in the real estate market. Although the share of 99acres.com is increasing, it isn’t translating into revenue growth.

The adoption of IND-AS has resulted in lower revenue in 99acres.com – certain items of non-refundable fees received upfront are now being recognized as revenue over the tenure of the contract. However, because the company restated 1QFY16 financials, the YoY comparison stands valid.

The segment had losses of INR160m during the quarter, which is lower compared to INR350m in the corresponding quarter in the previous year. The reduction in loss was on account of lower advertisement expenses, which are directly impacted by competitive intensity in the market. The company however continues to spend on product and user experience, while maintaining focus on cost structure improvement and reduction of burn.

As measured by Comscore, 99acres.com has seen an average market share in the late 40s over the quarter.

Exhibit 5: Subdued real estate market affecting revenue growth

Source: Company, MOSL; *IND-AS

Naukri.com Topline grew 14% YoY, led by increased traction in newly launched products, but

bogged down by a slowdown in the Gulf business, where the market has been has been impacted by falling oil prices.

Although the Indian market is stable, there is a likelihood of some slowdown in hiring in the South – in the sectors of IT/ITeS and start-ups. This hasn’t yet impacted numbers and is yet too early to be called a trend. Southern markets are still doing better than the other markets, growing at 25%+ YoY, compared to the average of 15-17%.

EBITDA margins in the recruitment business were at 53%, compared to 51% in the previous year.

155 185 190 230 230 245 230 299 271

278 259 317 279

47.6 59.5

37.1 46.0 48.4

32.4 21.1

30.0 17.8 13.3 12.6

5.9 2.8

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

99acres.com (INR m) YoY (%)

Info Edge India

25 July 2016 5

Exhibit 6: Healthy outlook for revenue growth at Naukri.com, supported by new products

Source: Company, MOSL; *IND-AS

Zomato.com Zomato has been tracking well on its goals so far. The company is targeting

doubling of revenue and turning cash positive during the year. Both these are progressing well.

Jeevansathi.com Jeevansathi.com saw revenue growth of 37% YoY to INR150m, and profit of

INR6.5m. The business saw profitability after several years. Exhibit 7: Jeevansathi.com seeing improved traction

Source: Company, MOSL; *IND-AS

Investments during the quarter During the quarter, INFOE made two investments: Diro Labs (contacts

management) and Unnati (hiring of urban blue collar workers). Change in estimates: Slight cut in estimates led by real estate weakness The quarter saw a slight miss in revenue, led by the recruitment business

(weakness in Gulf) and 99acres.com (slump in the real estate market). This has led to a cut of 1.2/1.5% in our revenue estimates for FY17/18E.

Profitability was largely in line with our estimates, and has been trending on expected lines. Our earnings estimates are thus little changed at -0.6% for FY17/18E each.

901 903 911 1005 1041 1072 1084 1252 1263 1282 1294 1489 1440

8.0 8.3 10.8 13.6 15.5

18.7 19.0 24.6

21.3 19.6 19.4 18.9 14.0

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

Recruitment (INR m) YoY (%)

87 93 85 95 95 95 97 106 109 110 117 134

150 17.0 16.0 13.0 1.5 8.9 1.1 14.6 11.5 14.7 16.0 20.6

27.4

37.6

1QFY

14

2QFY

14

3QFY

14

4QFY

14

1QFY

15

2QFY

15

3QFY

15

4QFY

15

1QFY

16*

2QFY

16

3QFY

16

4QFY

16

1QFY

17*

Jeevansathi.com (INR m) YoY (%)

Info Edge India

25 July 2016 6

Exhibit 8: Change in estimates

Revised Earlier Change Standalone business FY16 FY17E FY18E FY16 FY17E FY18E FY16 FY17E FY18E Revenue (INRb) 7.2 8.4 9.9 7.2 8.5 10.1 0.0 -1.2 -1.5 YoY (%) 18.3 16.5 18.1 18.3 17.9 18.4 0bp -140bp -30bp EBITDA (%) 21.8 26.6 29.9 21.8 26.6 30.0 0bp 0bp -10bp EPS (INR) 11.7 17.2 22.1 11.7 17.3 22.2 0.0 -0.6 -0.6

Source: MOSL, Company

Valuation and view Direct and high quality play on exploding e-commerce opportunity: India’s Ecommerce industry is expected to grow from current size of USD14b

to USD70b by 2020. As per Google, Classifieds segment is expected to grow at a CAGR of 22.5%, with jobs, real estate and matrimony constituting 2/3rd of the market.

As the GDP growth revives it India, it will directly benefit INFO’s recruitment segment growth, which has had a 7-8pp historical multiplier effect for every 1pp uptick in GDP growth. Naukri.com’s traffic share is almost 70%

Initial signs of reducing industry burn vindicate prudent investment strategy

The scenario in venture capital funding looks changed in the last few months with Companies making a pivot towards monetization and profitability. This would imply that the worst in terms of month-on-month burn is behind. We believe this plays into INFOE’s strategy of staying put to protect its market leadership in multiple franchises like 99acres.com, and it can now look forward to deriving the financial rewards from the investments sooner rather than later.

Revival of GDP growth to help flagship recruitment segment: Naukri.com should directly and disproportionately benefit from the pick-up in GDP growth. This should be compounded by pickup in demand for IT resources. We expect revenue CAGR of 17% over FY16-18E in flagship Naukri.com’s revenues. We expect 99acres.com to continue doing well too, and expect revenue CAGR of 16% over FY16-18 on a small base, and led by leadership in the market (despite weakness in the real estate market).

Disciplined management action drives confidence: Backing strong teams: Despite buying significant stake in investee

companies, the approach has been to back teams and get involved as and when guidance is sought.

Prioritizing: Investments where either scale visibility dwindled and / or company’s focus changed, INFOE has been quick to write them off its books (INR356m to date)

Feeding the virtuous cycle: Irrespective of business cycles, Nauki.com’s cost base increases 15-20% every year to stay ahead in terms of product innovation.

SOTP-based price target of INR1,000: We adopt sum-of-the-parts (SOTP)

methodology to value INFOE. We separately value the in-house business – Naukri.com, 99acres.com, Jeevansathi.com and also INFOE’s share in its

Info Edge India

25 July 2016 7

investee companies – Zomato.com, Meritnation.com, Policybazaar.com, Mydala.com, and Canvera.com. While the recruitment business remains the cash cow, 99acres.com, along with holdings in Zomato.com, driving significant value for the company, going forward. Our SOTP target price of INR1,000 remains unchanged, and implies 15% upside. We see INFOE as a direct and preferred play on the fast expanding e-commerce opportunity. Maintain a Buy.

Exhibit 9: SOTP valuation

Segment Methodology Methodology description Valuation (INR b)

Contribution (INR per share)

Naukri 25x recruitment NOPLAT

We value Naukri.com's post tax operating profits at 25x. Historically, INFOE trades at 30x+ when recruitment segment dominated and all others were insignificantly small (INR20 per share of investments). INFOE's valuation on overall company's profits (including yield on cash) was 30x+

61.6 500

99acres.com 6x forward sales

Lower end of sales multiple of peers such as rightmove.co.uk, realestate.com.au, zillow.com, zoopla.co.uk All trade in a tight sales band of 6-17x Growth in 99acres.com is expected to be higher than peers once the real estate segment picks up. But we ascribe median multiple of 6x

9.3 75

Zomato.com Valuation ascribed in the latest round of funding

Zomato raised USD60m of funding at a valuation close of USD1b. INFO did not participate in this round bringing its stake down to ~47% 29.6 241

Meritnation Valuation ascribed in the latest round of funding

Meritnation raised USD4m in the latest round of funding on June 2015. This, as per our analysis, values the company at ~USD125m. Since there were no new investprs, we keep the valuation pegged at previus levels of USD100m

4.0 32

Mydala.com 3x forward sales

Mydala.com is looking at raising USD80m, at pre-money valuation of USD200m. With strong revenue and profitability prospects, and target of USD40m revenus by FY17, it could command higher valuations in further rounds. We value the business at USD150m

3.0 24

Policybazaar.com Valuation ascribed in the latest round of funding

INFOE's deal with Temasek to sell half its stake in Policybazaar.com values the company at USD210m 1.4 11

Jeevansathi.com 3x forward sales JS is the 3rd biggest player in the online matrimony market. We assume 15% CAGR in revenues and value the franchise at 3x forward revenues

1.7 15

Canvera Valuation ascribed in the latest round of funding

Canvera raised INR150m from INFOE in latest round of funding (3QFY16), which increased INFOE's stake from 38% to39%, effectively pegging the company's value at INR4000m

0.4 4

Cash On books 11.4 93 Total 995

Source: MOSL

Exhibit 10: 1-year forward PE band

Exhibit 11: 1-year forward PB band

42.4

73.1

37.4

19.1 10

25

40

55

70

85

Nov

-06

Nov

-07

Nov

-08

Oct

-09

Oct

-10

Sep-

11

Sep-

12

Aug-

13

Aug-

14

Aug-

15

Jul-1

6

PE (x) Peak(x) Avg(x) Min(x)

5.2

12.9

5.7

3.0 1.03.05.07.09.0

11.013.015.0

Nov

-06

Nov

-07

Nov

-08

Oct

-09

Oct

-10

Sep-

11

Sep-

12

Aug-

13

Aug-

14

Aug-

15

Jul-1

6

PB (x) Peak(x) Avg(x) Min(x)

Info Edge India

25 July 2016 8

Story in charts

Exhibit 12: Recruitment segment dominated the standalone business…

Source: Company, MOSL

Exhibit 13: … and is the only materially profit making business in the group

Source: Company, MOSL

Exhibit 14: Recruitment business is closely linked to GDP growth…

Exhibit 15: … but leadership position to sustain on network effect

Exhibit 16: Investee company details Amt. Invested Holding FY16 summary (INR m) Company (INR m) % Revenue EBITDA

Zomato.com 4,838 46 1849.7 -4409.6 Meritnation.com 968 59 287.1 -414.2 Policybazaar.com 325 10

2,708.6 --1,647.8

Mydala.com 270 42 Canvera.com 901 49 Happily Unmarried.com 163 44 Vacationlabs.com 60 26 Bigstylist.com 64 25 Bluedolph.in 74 35 Total 7,663 4,845.4 -6,471.6 Written off / provisioned for Studyplaces.com 45 13 99labels.com 285 47 Floost.com 26 31

Source: MOSL, Company

73

7

16 5

Recruitment

Matrimonial

Real Estate

Others

813

-130 -114

74

Recruitment Matrimonial Real Estate Others

Standalone business EBITDA (INR m)

7.8 -7.7

24.1

25.4 11.3 9.8

19.6 19.4

6.7 8.6

8.9

6.7

4.5 4.7

7.2 7.6

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

Recruitment revenue growth (%)GDP Growth (%)

Info Edge India

25 July 2016 9

Exhibit 17: Operating Metrics

4QFY14 1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16 3QFY16 4QFY16 Naukri.com

Number of Resumes (m) 37 38 39 40 41 42 44 45 46 Avg Resumes added daily (000s) 10 12 13 9 10 13 13 11 13 Average no. of Resumes Modified Daily (000s) 127 116 135 124 133 166 185 163 195 Number of Unique Customers (000s) 29 31 31 31 33 34 34 34 36 IT/ITeS 28 28 29 28 31 29 29 30 31 BFSI 5 5 5 5 5 5 5 4 5 Infrastructure 18 17 17 17 16 16 15 15 14

Jeevansathi.com

Number of profiles ever loaded (m) 6.1 6.3 6.5 6.6 6.8 7 7.2 7.4 7.6 Avg profiles acquired daily 1,553 1,486 1,849 1,872 2,050 2,131 2,455 2,241 1,925 Number of unique paid customers 26,030 23,922 23,599 27,556 30,692 29,734 30,951 37,435 36,300 Avg amount realised in INR 3,555 3,758 3,897 3,679 3,586 3,583 3,514 3,182 nm

99acres.com

Number of listings 673 772 834 852 964 900 1,042 1,095 1,098 Number of paid listings 532 603 609 588 663 623 728 748 747 Number of paid transactions 17.2 18.2 21.0 19.2 20.7 17.6 24.6 23.7 22.4

Segmantal Revenues

Net Sales (INR m) 1,382 1,449 1,476 1,457 1,733 1,718 1,741 1,734 2,042 Recruitment Solutions (INR m) 1005 1041 1072 1084 1252 1247 1282 1294 1489 Other Verticals (INR m) 377 408 404 373 481 471 459 440 553 Jeevansathi 95 95 95 97 106 109 110 117 134 99acres 230 230 245 230 299 253 278 259 317 Other 52 83 65 46 77 109 72 64 102

PBT (INR m) Recruitment Solutions (INR m) 519 538 538 534 695 639 682 641 789 99acres

-48 -105 -150 -76 -361 -272 -213 -134

Other -46 -3 -29 -41 -36 -35 -83 -48 -9

Headcount 3,168 3,406 3,681 3,701 3,817 4,049 4,124 4,082 4,220

Source: MOSL, Company

Operating metrics

Financials and Valuations

Income Statement (INR Million) Y/E Mar 2011 2012 2013 2014 2015 2016 2017E 2018E Net Sales 2,940 3,771 4,372 5,059 6,116 7,235 8,427 9,950 Change (%) 25.8 28.3 16.0 15.7 20.9 18.3 16.5 18.1 EBITDA 981 1,442 1,498 1,668 1,822 1,580 2,243 2,970 EBITDA Margin (%) 33.4 38.3 34.3 33.0 29.8 21.8 26.6 29.9 Depreciation 71 77 94 174 173 210 249 271 EBIT 910 1,366 1,404 1,494 1,649 1,370 1,994 2,699 Interest -51 20 25 51 30 1 0 0 Other Income 279 395 465 432 764 827 935 981 Extraordinary items 0 0 -293 0 292 -160 0 0 PBT 1,240 1,740 1,551 1,876 2,675 2,037 2,929 3,680 Tax 400 511 528 591 736 621 807 957 Tax Rate (%) 32.3 29.3 34.1 31.5 27.5 30.5 27.6 26.0 Min. Int. & Assoc. Share 0 0 0 0 0 0 0 0 Reported PAT 840 1,230 1,022 1,285 1,939 1,416 2,122 2,723 Adjusted PAT 840 1,230 1,315 1,285 1,647 1,575 2,122 2,723 Change (%) 47.4 46.4 7.0 -2.3 28.2 -4.3 34.7 28.3

Balance Sheet (INR Million) Y/E Mar 2011 2012 2013 2014 2015 2016 2017E 2018E Share Capital 546 546 1,092 1,092 1,202 1,209 1,209 1,209 Reserves 4,084 5,198 5,563 6,530 15,422 16,431 17,785 19,697 Net Worth 4,630 5,744 6,654 7,622 16,624 17,640 18,994 20,907 Debt 7 3 5 4 3 60 63 63 Deferred Tax 0 0 0 0 0 0 0 0 Total Capital Employed 4,637 5,747 6,659 7,626 16,627 17,700 19,057 20,970 Gross Fixed Assets 856 908 1,378 1,501 1,635 1,901 2,180 2,520 Less: Acc Depreciation 318 376 471 645 700 881 1,129 1,400 Net Fixed Assets 539 531 908 857 935 1,020 1,051 1,120 Capital WIP 154 94 98 95 0 0 0 0 Investments 2,982 3,666 4,526 6,306 14,552 7,762 16,071 16,071 Current Assets 2,319 3,183 2,974 2,558 3,934 11,795 5,505 7,922 Debtors 39 36 45 50 98 118 93 109 Cash & Bank 2,037 2,985 2,710 2,311 3,007 9,522 1,074 3,055 Loans & Adv, Others 242 162 220 196 829 2,155 4,337 4,758 Curr Liabs & Provns 1,121 1,728 1,847 2,189 2,794 2,877 3,570 4,144 Curr. Liabilities 979 1,496 1,606 1,865 2,341 2,448 3,210 3,785 Provisions 142 231 241 324 452 429 359 359 Net Current Assets 1,197 1,456 1,127 368 1,140 8,918 1,935 3,778 Total Assets 4,872 5,747 6,659 7,626 16,627 17,700 19,057 20,970

Info Edge India

25 July 2016 10

Financials and Valuations Ratios Y/E Mar 2011 2012 2013 2014 2015 2016 2017E 2018E Basic (INR) EPS 7.7 11.3 12.0 11.8 13.7 13.0 17.2 22.1 Cash EPS 8.3 12.0 12.9 13.4 15.1 14.7 19.2 24.3 Book Value 42.4 52.6 60.9 69.8 138.3 145.3 154.2 169.7 DPS 0.4 1.0 1.0 2.5 3.0 4.0 5.5 5.5 Payout (incl. Div. Tax.) 5.7 10.4 9.7 23.4 26.4 37.0 38.2 29.8 Valuation(x) P/E 65.3 56.1 59.3 44.6 34.8 Cash P/E 57.6 50.8 52.3 40.0 31.6 Price / Book Value 11.0 5.6 5.3 5.0 4.5 EV/Sales 15.4 13.7 10.6 9.3 7.7 EV/EBITDA 46.7 46.0 48.4 35.1 25.8 Dividend Yield (%) 0.0 0.0 0.0 0.0 0.0 Profitability Ratios (%) RoE 19.8 23.7 21.2 18.0 13.6 9.2 11.6 13.7 RoCE 19.0 24.0 21.5 18.5 13.8 9.2 11.5 13.6 RoIC -144.4 -125.7 -119.6 -116.2 -112.9 -380.7 124.1 106.4 Turnover Ratios (%) Fixed Asset Turnover (x) 4.2 6.0 4.3 5.3 6.5 7.1 8.0 8.9 Debtors (No. of Days) 5 3 4 4 6 6 4 4 Leverage Ratios (%) Net Debt/Equity (x) -0.4 -0.5 -0.4 -0.3 -0.2 -0.5 -0.1 -0.1

Cash Flow Statement (INR Million) Y/E Mar 2011 2012 2013 2014 2015 2016 2017E 2018E Adjusted EBITDA 981 1,442 1,498 1,668 1,822 1,580 2,243 2,970 Non cash opr. exp (inc) -325 -245 -421 -334 146 -771 -657 -957 (Inc)/Dec in Wkg. Cap. 446 385 -187 -425 2 282 -1,374 137 Other operating activities 0 0 0 0 0 0 0 0 CF from Op. Activity 1,101 1,582 890 908 1,970 1,091 212 2,151 (Inc)/Dec in FA & CWIP -585 -1,103 -2,012 -1,024 -2,151 -1,620 -347 -340 Free cash flows 516 479 -1,122 -115 -181 -529 -135 1,811 (Pur)/Sale of Invt -1,232 517 988 9 -6,279 7,744 -7,502 981 Others 0 0 0 0 0 0 0 0 CF from Inv. Activity -1,817 -586 -1,024 -1,015 -8,430 6,124 -7,849 641 Inc/(Dec) in Net Worth 0 0 -18 -36 7,497 25 0 0 Inc / (Dec) in Debt 0 -1 2 0 -4 0 2 0 Divd Paid (incl Tax) & Others -24 -48 -127 -255 -337 -726 -811 -811 CF from Fin. Activity -24 -49 -143 -291 7,156 -701 -809 -811 Inc/(Dec) in Cash -739 947 -276 -398 696 6,514 -8,447 1,980 Add: Opening Balance 2,778 2,038 2,986 2,709 2,311 3,007 9,522 1,075 Closing Balance 2,038 2,986 2,709 2,311 3,007 9,522 1,075 3,055

Info Edge India

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Corporate profile Exhibit 1: Sensex rebased

Source: MOSL/Bloomberg

Exhibit 2: Shareholding pattern (%) Mar-16 Dec-15 Mar-15

Promoter 43.1 43.2 43.8

DII 10.1 10.4 10.2

FII 35.4 35.1 29.3

Others 11.4 11.3 16.7

Note: FII Includes depository receipts Source: Capitaline

Exhibit 3: Top holders Holder Name % Holding

Nalanda India Equity Fund Limited 3.2

Amansa Holdings Private Limited 3.0

Aranda Investments (Mauritius) Pte Ltd 2.7

Kapil Kapoor 2.7

Matthews India Fund 2.7

Source: Capitaline

Exhibit 4: Top management Name Designation

Kapil Kapoor Chairman

Hitesh Oberoi Managing Director & CEO

Sanjeev Bikhchandani Executive Vice Chairman

Chintan Thakkar Whole Time Director & CFO

Murlee Manohar Jain Company Secretary

Source: Capitaline

Exhibit 5: Directors Name Name

Arun Duggal Bala Deshpande

Naresh Gupta Saurabh Srivastava

Sharad Malik

*Independent

Exhibit 6: Auditors Name Type

Price Waterhouse LLP Statutory

Source: Capitaline

Exhibit 7: MOSL forecast v/s consensus EPS (INR)

MOSL forecast

Consensus forecast Variation (%)

FY17 17.6 5.7 208.4

FY18 22.5 12.9 73.9

Source: Bloomberg

Company description Info Edge (India) Limited (Info Edge) is India’s premier on-line classifieds company in recruitment (naukri.com), matrimony (jeevansaathi.com), real estate (www.99acres.com), education (shiksha.com) and related services. The company, with a view to tap into the growing and vibrant Indian internet market, undertakes investments in early stage companies / start-up ventures. As of March 31, 2014, the company had investments in Zomato Media Pvt Ltd (www.zomato.com); Applect Learning Systems Pvt Ltd (www.meritnation.com); Etechaces Marketing and Consulting Pvt Ltd (www.policybazaar.com); Kinobeo Software Pvt Ltd (www.mydala.com); Canvera Digital Technologies Pvt Ltd (www.canvera.com) and Happily Unmarried Marketing Pvt Ltd (www.happilyunmarried.com).

Info Edge India

25 July 2016 12

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