Urban Company: Morgan Stanley initiates coverage, see up to 26% upside; here's why
Overseas brokerage firm Morgan Stanley has initiated coverage on recently listed new age marketplace player Urban Company, expecting a 26% fall in the stock.
- Oct 23, 2025,
- Updated Oct 23, 2025 12:32 PM IST
Overseas brokerage firm Morgan Stanley has initiated coverage on recently listed new age marketplace player Urban Company. However, the global broking major saw up to 26 per cent downside in the recent debutant, citing its rich valuations and all the positive price in the counter.
Urban Company had made its stock market debut nearly a month ago, in mid-September 2025 after the company raised a total of Rs 1,900.24 crore via IPO by selling its shares for Rs 103 apiece. The stock made a robust Dalal Street debut and scaled Rs 201 on September 22, surging nearly 95 per cent from its issue price.
However, the stock had settled at Rs 157.85 on Tuesday but dropped more than 3.5 per cent to Rs 152.20 on Thursday, with its market capitalization slipping below Rs 22,000 crore mark. The stock is still 50-52 per cent above its IPO price.
The company has a large addressable market in the online home services, supported by strong moats, said Morgan Stanley, which has initiated coverage with an 'underweight' rating, citing that all the positives of growth have been priced in at the current stock price. High churn and supply constraints shall keep growth calibrated, it said.
Core India consumer services net transaction value (NTV) is expected to grow at a healthy 18-22 per cent CAGR over FY25-28. India Consumer Services (ex-Insta) may reach 30 per cent, adjusted ebitda margin in the medium term, Morgan Stanley said. "Valuation multiples likely to remain in-line with strong & established India internet peers," added with a target price of Rs 117.
Incorporated in December 2014, Urban Company is a technology-driven, full-stack online marketplace offering home and beauty services. It has presence across 51 cities across India, United Arab Emirates and Singapore, excluding cities served by its Kingdom of Saudi Arabia joint venture.
Overseas brokerage firm Morgan Stanley has initiated coverage on recently listed new age marketplace player Urban Company. However, the global broking major saw up to 26 per cent downside in the recent debutant, citing its rich valuations and all the positive price in the counter.
Urban Company had made its stock market debut nearly a month ago, in mid-September 2025 after the company raised a total of Rs 1,900.24 crore via IPO by selling its shares for Rs 103 apiece. The stock made a robust Dalal Street debut and scaled Rs 201 on September 22, surging nearly 95 per cent from its issue price.
However, the stock had settled at Rs 157.85 on Tuesday but dropped more than 3.5 per cent to Rs 152.20 on Thursday, with its market capitalization slipping below Rs 22,000 crore mark. The stock is still 50-52 per cent above its IPO price.
The company has a large addressable market in the online home services, supported by strong moats, said Morgan Stanley, which has initiated coverage with an 'underweight' rating, citing that all the positives of growth have been priced in at the current stock price. High churn and supply constraints shall keep growth calibrated, it said.
Core India consumer services net transaction value (NTV) is expected to grow at a healthy 18-22 per cent CAGR over FY25-28. India Consumer Services (ex-Insta) may reach 30 per cent, adjusted ebitda margin in the medium term, Morgan Stanley said. "Valuation multiples likely to remain in-line with strong & established India internet peers," added with a target price of Rs 117.
Incorporated in December 2014, Urban Company is a technology-driven, full-stack online marketplace offering home and beauty services. It has presence across 51 cities across India, United Arab Emirates and Singapore, excluding cities served by its Kingdom of Saudi Arabia joint venture.