Urban Company gets 'Sell' call from Ambit; brokerage prefers PB Fintech, MakeMyTrip, TBO Tek, Blackbuck, Affle
"Urban Company has driven standardization/transparency in India's largely unorganized Rs 5 lakh crore home services market. High service quality and loyal customer base enabled 20 per cent India business CAGR over FY23-26. But further growth depends on non-top8 cities, with top8 penetration already ~51 per cent. Growth will require investments in marketing/service professionals, limiting core India business margin uptick," the brokerage stated.
- Mar 25, 2026,
- Updated Mar 25, 2026 9:05 AM IST
Ambit has initiated coverage on Urban Company Ltd with a 'Sell' rating and a 12-month target price of Rs 97, citing concerns over margin expansion and increasing competition.
"Urban Company has driven standardization/transparency in India's largely unorganized Rs 5 lakh crore home services market. High service quality and loyal customer base enabled 20 per cent India business CAGR over FY23-26. But further growth depends on non-top8 cities, with top8 penetration already ~51 per cent. Growth will require investments in marketing/service professionals, limiting core India business margin uptick," the brokerage stated.
Ambit noted, "Nascent on demand house help offering (Instahelp) faces competitive intensity and significant cash burn; both unlikely to ease medium term. We see scope for expansion in Instahelp; expect ~6x scale-up over FY26-28 and 40 per cent NTV CAGR over FY26-42. Competition will delay break-even for Instahelp to FY31; we value Instahelp business at Rs 15/sh. We value the business exInstahelp at Rs 82, implying 35x EV/FY28E adj. EBITDA for the core India business."
"Given high competition from Snabbit/Pronto, we build breakeven point for the company in FY31 and exit adj. EBITDA margin of 7 per cent by FY42. Native/International should grow FY26-28 NTV at 37/23 per cent CAGR, respectively, aided by increasing new categories for the Native business, while near-term uncertainty in the Middle East could impact growth in the short/medium term," it also stated.
"On a revenue basis, we build in a 25 per cent/17 per cent CAGR over FY26-28/42, led by the Instahelp business, which should grow at 137 per cent/40 per cent CAGR over FY26-28/42 and contribute 30 per cent of revenues," Ambit further said.
Among internet companies, the brokerage said it prefers PB Fintech, MakeMyTrip, TBO Tek, Blackbuck and Affle.
Ambit has initiated coverage on Urban Company Ltd with a 'Sell' rating and a 12-month target price of Rs 97, citing concerns over margin expansion and increasing competition.
"Urban Company has driven standardization/transparency in India's largely unorganized Rs 5 lakh crore home services market. High service quality and loyal customer base enabled 20 per cent India business CAGR over FY23-26. But further growth depends on non-top8 cities, with top8 penetration already ~51 per cent. Growth will require investments in marketing/service professionals, limiting core India business margin uptick," the brokerage stated.
Ambit noted, "Nascent on demand house help offering (Instahelp) faces competitive intensity and significant cash burn; both unlikely to ease medium term. We see scope for expansion in Instahelp; expect ~6x scale-up over FY26-28 and 40 per cent NTV CAGR over FY26-42. Competition will delay break-even for Instahelp to FY31; we value Instahelp business at Rs 15/sh. We value the business exInstahelp at Rs 82, implying 35x EV/FY28E adj. EBITDA for the core India business."
"Given high competition from Snabbit/Pronto, we build breakeven point for the company in FY31 and exit adj. EBITDA margin of 7 per cent by FY42. Native/International should grow FY26-28 NTV at 37/23 per cent CAGR, respectively, aided by increasing new categories for the Native business, while near-term uncertainty in the Middle East could impact growth in the short/medium term," it also stated.
"On a revenue basis, we build in a 25 per cent/17 per cent CAGR over FY26-28/42, led by the Instahelp business, which should grow at 137 per cent/40 per cent CAGR over FY26-28/42 and contribute 30 per cent of revenues," Ambit further said.
Among internet companies, the brokerage said it prefers PB Fintech, MakeMyTrip, TBO Tek, Blackbuck and Affle.