In a CNBC-TV18 Chartbusters interview, IndiaMART founder Dinesh Agarwal outlines the company’s financial outlook and growth strategy through 2027. He explains that recent quarterly collections reached 283 crore rupees, with deferred revenue growing over 25%, projecting a sustained run‑rate of around 250‑300 crore rupees per quarter. The firm targets a 25 % compound annual growth rate to double its annual run‑rate from roughly 1,000 crore to 2,000 crore rupees by 2027. Growth is expected to be driven 80 % by paid‑subscriber additions (historically 15‑20 % YoY) and 20 % by ARPU increases (5‑7 % YoY). Margins have bottomed out and are projected to rise to the low‑30 % range, with a FY24 EBITDA margin target of about 30 %. Agarwal discusses inorganic growth, noting the BIZZY acquisition (now growing at ~20 % YoY) adds roughly 50 crore rupees of revenue, and signals openness to further M&A while current cash stands at about 2,000 crore rupees, to be split between investments and shareholder returns. Supplier count stands at 7.4 million (both GST‑registered and non‑registered), with a goal of reaching 10 million, and the company adds roughly 8,000 paid subscribers and 1 lakh resellers each quarter. The interview concludes with plans to revisit performance after Q4 results.
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Be seeing in the last few trading sessions. Let's talk about one of the other stocks on our radar right now. That's India Mart in the intermesh. You know it's rallied about what, 36% from the recent lows that we've seen on the stock. The founder of the company, Dinesh Agarwal joins in to tell us more and this after they have out, you know, given their outlook of doubling their business by 2027. Thanks a lot for joining in. You know that's the long term plan that you have. 2027. You want to double your revenues, take it to 2000 odd crores. But in the here and now, can you give us a sense of, you know, the quarterly run rate that you're tracking? 250 crores is what you've been doing for the last couple of quarters. Does that sustain? When do you go to 300 crores by and the margins, you said the previous quarters margins had bottomed out. How much is the improvement that we can foresee from here?
Yeah. So on the revenue front you can take the guidance from the collections from operation and deferred revenue. If you see the collections from operation, customers have been growing and last quarter it was 283 crores and deferred revenue has also been growing upwards of 25%. So we can expect this similar revenue growth in coming quarters on the revenue as well. On the EBITDA or margin side. As I said, we have been investing behind the growth in terms of manpower, in terms of technology and probably we are going to bottom out soon and then we will start to increase as earlier slowly and slowly towards 30, 35% range.
So you're saying you haven't bottomed out yet. There is some further downside to margins still. How much could that be according to you?
No, that could not be much. Maybe you know, quarter four is always less margin, more collections. So that is what is seasonal thing. But other than that, I think from probably the quarter one next year we will be trading at the similar 28, 29% and then it will probably start to move.
Okay. All right. Hi Mr. Agarwal, good morning. Quarter four, normally you'll pay out those incentives to your sales force as well. So sometimes I think that's the impact that you see in quarter four on margins. But going ahead, you know the broad headline is you move from an annual run rate of around 1000 to around 2000 crores. That's by 2027. Split this up for us. That means that you have to grow at A CAGR of close to 25%. How much of it will come in from higher Ardpos and how much of it will come in from higher subscription paid subscribers?
If you look at historically, our paid subscribers have been growing in the range of 15 to 20% on a longer term basis and ARPUs have been growing in the range of 5 to 7%. So we can expect a similar kind of revenue growth of about 20 to 25% in the times to come, given that in the past year we had good collections and good revenue increase.
All right. You know briefly, you mentioned when Mangalam asked you about your margins, you said that after this you gradually start moving to the early 30s. If I got that number correctly for FY24, what sort of a margin number will you guide for? Let's keep quarter four at the side. We don't want you to get in trouble with SEBI and we don't want us to know anything about the quarter that's gone by. But from the outlook from year on for FY24, what is the broad margin band? Should we book with the number closer to around 30%? Maybe 20 to 30%?
Yeah, I think we will target 30%. Let's see, 29 or 31, I cannot comment, but let's target 30%.
Right? You know, you said that of the 25% CAGR that you're projecting, 80% would come from member additions and the remaining 20% comes in from ARPU growth. What does that leave the room for acquisitions, inorganic opportunities and your current acquisitions to scale up to? I mean, are we looking at, you know, is there a plan that you have for a certain percentage of revenues coming in from inorganic acquisitions as well?
So if you look at the BIZEE acquisition, I think we are doing well, that BIZZY has been growing at 10 to 15% before our acquisition and now we have been able to increase the growth rate to upwards of 20%. And I think we will continue to maintain that. As you can see, we generate healthy cash margins and we continue to look out for good opportunities in M and A space. Let's see if we find anything as good as busy in going forward.
All right, Ms. Agarwal, you'll end this year, I think closer to around 202,000 paid subscribers. Very roughly early 200,000 odd. So going by what you're saying for FY24, you should end with a number closer to 245,000. Around a 20% growth on that base.
I mean, I have been guiding that. We will.
8,000 per quarter.
Yeah. 8,000 per quarter. So about 230, 235.
You can assume 235,000. So we've got a couple of numbers from you. One is the paid subscribers will at least go to around 235,000 with margins.
Closer to around 30 to 35.
30. Okay, we'll keep it in that band with margins closer to around 30%. Now out of your total pie, how much of it will come in from this inorganic growth? Your done a few acquisitions, but how do you see, I mean what is the current contribution? And those acquisitions are growing at a faster clip, right? So what will they contribute in the coming years?
There's only one 200% acquisition that we have done. One is the light keeping which is in very, very early stage. It is in the product market. And the other one is busy which is doing about 50 crores of revenue. So you can add that 50 crores of revenue which is already being added in this financial year. So from next year I don't think you will see any additional growth coming in.
Okay, and what is the current cash in the books?
The current cash in the books is about 2000 crores.
Around 2000 crores. So what do you use it for? If you are done with your acquisitions, will you look at some kind of money being returned to shareholders? I asked you this the last time as well, but is that the plan?
Yeah, we have been guiding that. We will split our collections into two different things. One is the investment and the other is the return to shareholders. And we'll continue to do that.
Just a couple of questions before we let you go. You know this is the other important aspect of your business which is suppliers close around 7.4 million right now. By when do you hit that 10 million mark? What industries are you targeting your suppliers coming in from? And you know, paying subscribers close to ARPU of close to around 49,000. Seems like you will easily cross 50,000 plus the next year. Where does that number settle?
So in terms of number of suppliers, these 7 million suppliers have GST and non regst both base. And if you look at the overall GST registered suppliers in India, they are about 1.3 million or so. 13 million or so. And out of that I think we have still gotten less than 20% on our platform so far. I think there is a lot of headroom to grow there. I cannot give you. We have been growing at about 1 lakh subscriber every month, 1 lakh resellers every month or so. And I think the similar trajectory if we continue to grow. I think we should be heading towards 8 million next year and then so on. Depends a lot on India growth story as well. And in terms of the paid subscriber, we have only grown recently very heavily and I think that percentage growth might reduce. But as I guided, we will continue to try to add about 8,000 per quarter.
All right. Running out of time. Not out of questions, Mr. Agarwal. We'll leave this for another opportunity to interact with you, perhaps after your fourth quarter numbers. And then we'll detail about other things, including competition as well. Take a.
