IndiaMart share price targets: Why this stock fell 8% after Q1 results; is it still a Buy?

IndiaMART InterMESH Ltd saw its shares falling 8 per cent in Wednesday's trade after at least three brokerages cut their target prices on the stock, citing elevated customer churn in the June quarter, with no respite from declining paid subscriber numbers.

Foreign brokerage Nomura, which suggested a target of Rs 1,810 on the stock, said Indiamart lost 1,800 paying subscribers in Q1FY27 against a loss of 1,200 subscribers in Q4FY26 and 1,000 in Q3FY26.

Gross addition remains anaemic and customer churn remains elevated, aggravating the subscriber addition problem, it said.

Following the development, the IndiaMart stock fell 7.51 per cent to hit a low of Rs 1,775 apiece on BSE. The scrip has fallen 26.60 per cent in the past one year.

Indiamart's customer collections rose 8 per cent YoY, largely driven by increased average revenue per user (ARPU).  Recall, the company had increased prices of its Silver Monthly and Annual products by 33 per cent and 15 per cent, respectively, in Q3FY26. 

"Gross addition (due to ongoing marketing efforts) have not yet picked up. We believe the company’s long-term ambition of 20 per cent collection growth -- 10 per cent driven by ARPU increase and 10 epr cent by customer base increase, needs a significant push on the latter," Nomura said.

Jefferies suggested an 'Underperform' rating on the stock with a lower target of Rs 1,650 against Rs 1,810 earlier. Centrum Broking turned 'Neutral on the stock after keeping 'Buy' call for nine months, with a lower target of Rs 2,073 against Rs 2570 earlier. DAM Capital revised its target lower on the stock to Rs 1,680 against Rs 2,020 earlier.

Choice Institutional Equities said near-term growth is expected to remain ARPU-led amid elevated churn, softer buyer enquiries and evolving LLM-driven search dynamics. 

"We retain our ‘ADD’ rating but lower our multiple to 20x (earlier 22x) to arrive at a target to Rs 2,060, as a meaningful re-rating is contingent on sustained improvement in subscriber additions, buyer traffic and marketplace activity," it said.

ICICI Securities, however, feels the stock is attractive at current valuation despite a muted revenue growth outlook on account of sustained monetisation improvement of core customers and automation-led efficiencies manifesting in a 6 per cent employee reduction in the last nine months. It suggested 'Buy' with a target of Rs 2,300 on the stock. 
  
Following Indiamart's Q1 results, Bloomberg consensus target now stands at Rs 2,095.11, implying 11 per cent potential upside. The stock has 10 Buy calls, six 'Sell' recommendations and two 'Hold' ratings.