Summary
IndiaMART InterMESH Limited - Q3 FY2026 Earnings Call Summary Tuesday, January 20, 2026, 17:00 hrs
Event Participants
Executives 5 Avijit Vikram, Brijesh Kumar Agrawal, Dinesh Chandra Agarwal, Jitin Diwan, Prateek Chandra
Analysts 7 Amit Chandra, Anirudh Shetty, Anmol Garg, Devang Patel, Nikhil Choudhary, Prashant Kothari, Shubham Sehgal
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Collections (Consolidated) | ₹426 crores | +17% YoY; Outpaced revenue growth, acting as a leading indicator for future quarters. |
| Revenue from Operations | ₹402 crores | +13% YoY; Driven by growth in ARPU and deferred revenue realizations. |
| Deferred Revenue | ₹1,775 crores | +19% YoY; Reflects strong historical collections and multi-year contract bookings. |
| EBITDA | ₹134 crores | 33% margin; Impacted by a ₹8.5 crore one-time expense related to the new labour code. |
| Net Profit | ₹188 crores | Includes a one-time fair valuation gain of ₹82 crores from Baldor Technologies. |
| Paying Suppliers | 2,21,000 | -1,000 count QoQ; Decline due to Silver tier price hikes and fewer working days in the festival season. |
| ARPU (Total) | ₹1,81,000 (approx) | +6% YoY; Normalizing toward the long-term target range of 6-8%. |
| ARPU (Top 10%) | ₹11,00,000 | +6% YoY; Management noted this segment drives the bulk of company profitability. |
| Unique Business Inquiries | 28 million | +4% YoY; Growth moderated from mid-teens due to seasonal holiday factors and reduced ad spend. |
| Treasury Balance | ₹3,051 crores | As of Dec 31, 2025; Includes strong cash generation from operations of ₹129 crores. |
Geographic & Segment Commentary
- IndiaMART Standalone: Collections reached ₹390 crores (+14% YoY), showing recovery from previous sub-10% growth levels. Strategic focus remains on balancing supplier growth in the Silver tier with high-value monetization in Gold and Platinum tiers. Asset quality (lead quality) has improved following product tweaks, though churn in the monthly Silver segment remains a challenge.
- Busy Infotech: Recorded billings of ₹33 crores with a normalized YoY growth of 28%. Revenue from operations stood at ₹32 crores with deferred revenue growing 56% on a normalized basis. The segment sold 10,000 new licenses in Q3, bringing the total base to 4.31 lakh licenses.
- Accounting Portfolio (Other): Vyapar continues to target micro-businesses focused on mobile-based billing, while Livekeeping serves the Tally ecosystem by providing mobile/browser access. These products complement Busy Infotech by targeting different SME size brackets.
Company-Specific & Strategic Commentary
- Pricing Strategy: Implemented significant price hikes in the Silver tier (Monthly: ₹3,000 to ₹4,000; Annual: ₹28,500 to ₹32,000). Management expects to see the full impact on churn and gross additions by Q1 FY2027 as annual renewals come due.
- AI Integration: Transitioned 80% of buyer interactions to AI voice bots, improving productivity and inquiry quality. The company is exploring “Copilots” for sales/service teams to provide context and suggest actions during customer meetings.
- Market Positioning: Reaffirmed commitment to the “classified+” model, focusing on tech-enabled matchmaking and credit facilitation rather than moving into fulfillment, logistics, or inventory-heavy models.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Paid Supplier Growth | Near-zero net adds | One more quarter (Q4 FY26) of flat growth expected as sales teams adjust to new pricing. |
| ARPU Growth | 6-8% (Long-term) | Normalizing from higher levels as customer addition/churn stabilizes. |
| Collection Growth | Mid-teens | Targeting similar performance in Q4 FY26 based on Platinum/Gold tier retention. |
| Churn Improvement | Visible by Q1 FY27 | Management expects annual retention trends to become clearer after a full cycle of product/pricing changes. |
Risks & Constraints
| Risk | Context |
|---|---|
| Price Elasticity | Significant Silver tier price hikes (up to 33% on monthly) led to a temporary decline in gross additions; long-term elasticity remains unproven. |
| High Churn | Monthly Silver subscriptions show no signs of respite in churn; high attrition in field sales and telesales roles continues to pressure execution. |
| AI Search Disruption | Potential shift of buyer traffic from Google (traditional source) to AI/LLM bots; IndiaMART is mitigating this by focusing on repeat traffic (currently ~59%). |
| Bot Traffic | Increasing difficulty in distinguishing human traffic from “agentic” and LLM crawlers led the company to stop reporting total traffic metrics. |
Q&A Highlights
Supplier Growth & Market Saturation
- Question: Is the market saturated given the subdued paid supplier numbers? (Anmol Garg)
- Answer: No, there is unlimited demand for quality leads. Recent weakness is due to price hikes and a focus on lead quality rather than saturation (Dinesh Agarwal).
Pricing & Churn
- Question: Why take a steep price hike when churn is not yet under control? (Swapnil Potdukhe)
- Answer: The decision follows years of static pricing; management believes users care more about lead conversion than a ₹1,000 difference. Most “fence-sitters” would have churned regardless (Dinesh Agarwal).
Traffic & AI Threats
- Question: How do you view the threat of AI search (ChatGPT/Gemini) replacing Google traffic? (Devang Patel)
- Answer: AI expands the TAM. IndiaMART features well in AI responses, but the long-term solution is driving repeat traffic, which is currently at an all-time high of 58-59% (Dinesh Agarwal).
Accounting Strategy
- Question: How do Busy, Vyapar, and Livekeeping differentiate from Tally/Zoho? (Vaibhav Jain)
- Answer: Busy targets inventory-heavy SMEs; Vyapar focuses on micro-businesses/mobile billing; Livekeeping provides mobile access to existing Tally users (Brijesh Agrawal).
Key Takeaway
IndiaMART delivered a stable Q3 FY2026 with 13% revenue growth and a 17% increase in consolidated collections, signaling potential top-line acceleration. While the company faced a net decline of 1,000 paying suppliers due to aggressive price hikes in the Silver tier and seasonal factors, the Platinum and Gold segments—representing 75% of revenue—showed resilient retention. Management’s strategic pivot toward high-quality lead generation and AI-driven automation, including the migration of 80% of buyer calls to bots, aims to solve historical churn issues. Profitability remains healthy with a 33% EBITDA margin, despite a one-time ₹8.5 crore labour code impact. Investors should monitor the Q1 FY2027 renewal cycle to gauge the long-term success of recent pricing changes and the company’s ability to return to double-digit supplier growth.
Want more insights like this?
Subscribe to get deep dives delivered to your inbox.
More Earnings Summaries
Explore more Q3 FY26 earnings call analyses: