Shares of Info Edge (India) Ltd, the parent company of Naukri.com, saw a sharp drop on Wednesday, May 28, following the announcement of its Q4FY25 earnings. Despite reporting a massive 647% jump in net profit to ₹740 crore, the stock declined by over 2% during early trade. This surprising market reaction has left many investors asking the all-important question: Should you buy, sell, or hold Info Edge stock now?
Info Edge Q4FY25 Highlights
| Particulars | Q4FY25 | Q4FY24 | YoY Growth |
|---|---|---|---|
| Net Profit | ₹740 crore | ₹162 crore | +647% |
| Revenue from Operations | ₹750 crore | ₹664 crore | +13% |
| Impairments & Provisions | ₹127 crore | — | Not Comparable |
| Stock Price (at 9:45 am) | ₹1,420 | ₹1,452 | -2.2% (Day) |
The multi-fold rise in profit came on the back of reclassifying a joint venture as a financial investment, boosting other income. However, the bottom line was partially impacted by provisions and impairments worth ₹127 crore during the quarter.
Recruitment and Non-Recruitment Segments Shine
The company’s recruitment business, which includes Naukri.com, saw strong billing growth of 18% quarter-on-quarter, particularly from key sectors like IT services and Global Capability Centers (GCCs). Notably, non-tech industries such as BFSI (Banking, Financial Services and Insurance), healthcare, and infrastructure also contributed double-digit growth—an encouraging sign of a broad-based hiring recovery.
Commenting on the performance, Hitesh Oberoi, MD and CEO of Info Edge, said:
“After a muted start, recruitment billings accelerated well quarter-over-quarter. Our non-recruitment businesses also sustained momentum, gaining market share and turning cash positive for the full year.”
This performance underlines Info Edge’s growing resilience beyond its flagship Naukri platform, with platforms like 99acres (real estate), Jeevansathi (matrimony), and Shiksha (education) increasingly contributing to revenue.
Brokerage Views: Mixed Sentiments on Stock Valuation
Despite solid financial results, analysts are divided on whether to remain bullish on the stock.
🔸 Motilal Oswal – Neutral, Target: ₹1,350
Motilal Oswal appreciated the diversified growth but cautioned investors, noting that despite the recruitment uptrend, the stock’s valuation may be peaking.
“Sectors like BFSI and healthcare are showing signs of hiring recovery. However, given the recent rally and current valuation, we maintain a Neutral stance.”
🔸 Nuvama Institutional Equities – Buy, Target: ₹1,700
Nuvama remained bullish but lowered its target price from ₹1,820 to ₹1,700, citing rising marketing expenses and AI investments as potential margin dampeners in the near term.
“Billing growth is solid, but higher ad spending and AI investments could weigh on profitability. Long-term outlook remains positive.”
🔸 Nomura – Neutral, Target: ₹1,670
Nomura also trimmed its price target from ₹1,702 to ₹1,670, pointing to lower core profitability and reduced expectations from its stake in Eternal.
Key Financial Ratios (FY25 Q4)
| Financial Metric | Value |
|---|---|
| Operating Margin | ~23.5% |
| Return on Equity (ROE) | ~12.4% |
| Price-to-Earnings (P/E) Ratio | ~78x (TTM) |
| Debt-to-Equity Ratio | 0.00 (Debt-Free) |
| EPS (TTM) | ₹18.2 |
Should You Buy, Sell, or Hold Info Edge Shares?
Here’s a breakdown to help you decide:
✅ Buy If:
- You believe in the long-term growth of India’s digital economy and job tech sector.
- You value diversification across recruitment, real estate, matrimony, and education.
- You are comfortable with short-term margin pressures due to strategic investments.
⚠️ Hold If:
- You are already invested and want to wait for a better exit point.
- You expect macro conditions (e.g., hiring in India) to further stabilize before committing more.
❌ Sell If:
- You are a short-term investor looking for high momentum plays.
- You are concerned about high valuations and margin contractions in the near term.
Conclusion
While Info Edge posted a stellar profit jump, investor caution is evident due to margin concerns and premium valuations. The company’s continued focus on digital investments and AI-driven growth is promising, but it comes at the cost of higher spending.
Investors should evaluate their risk appetite and investment horizon before making a decision, especially in a volatile mid-cap environment.
FAQs on Info Edge Q4FY25 Results
Q1. Why did Info Edge’s stock fall despite a 647% jump in profit?
A1. The profit jump was primarily due to accounting reclassification gains, while provisions and higher expenses raised concerns. Additionally, analysts flagged high valuations and margin pressures.
Q2. What drove Info Edge’s Q4 performance?
A2. Strong recruitment billings, growth in non-tech hiring sectors, and steady performance from non-recruitment platforms like 99acres and Shiksha.
Q3. Is Info Edge a debt-free company?
A3. Yes, Info Edge has a debt-free balance sheet, which adds to its financial stability.
Q4. What are brokerages saying about Info Edge stock?
A4. Mixed views: Motilal Oswal and Nomura maintain a neutral rating, while Nuvama has a buy call but with a reduced price target.
Q5. Should I invest in Info Edge now?
A5. If you’re a long-term investor willing to withstand short-term volatility, the stock has potential. But short-term traders may want to wait for more clarity on profitability.
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