Goldman Sachs Sees 40% Upside In MapmyIndia; Stock Hits 20% Upper Circuit

SUMMARY

Goldman Sachs has set a price target of INR 2,800 on the stock, which implies an upside of almost 40% to MapmyIndia’s close on Wednesday

The startup is well-poised to benefit from an early leadership position in fast-growth end-markets, including automotive navigation, mapping devices, connected vehicles, telematics, and government digitisation, said the brokerage

Shares of MapmyIndia were locked at the 20% upper circuit on the BSE today and ended the day’s trading at INR 2,401.9

Shares of geotech startup MapmyIndia jumped 20% to touch the upper circuit at INR 2,401.9 during the intraday trading on the BSE on Thursday (June 20) after Goldman Sachs initiated coverage on the stock with a ‘buy’ rating.

The international brokerage set a price target of INR 2,800 on the stock, which implies an upside of almost 40% to MapmyIndia’s close at INR 2,001.6 on Wednesday.

Goldman Sachs said the startup is well-poised to benefit from an early leadership position in fast-growth end-markets, including automotive navigation, mapping devices, connected vehicles, telematics, and government digitisation.

The brokerage believes that MapmyIndia’s core profit pool lies in its IP-protected digital mapping service built over more than three decades and overlaid with valuable data such as demographics, law and order, natural resources, infrastructure, and other insights. It forecasts a revenue CAGR of 38% in the FY24-FY27 period, with a steady EBITDA margin in the 38% to 41% range.

MapmyIndia divides its market-wise revenue into two categories – automotive and mobility tech business (A&M) and consumer tech and enterprise digital transformation (C&E). Its C&E revenue grew 49% year-on-year (YoY) to INR 194 Cr in FY24, while A&M revenue rose 23% to INR 186 Cr.

The startup said during its FY24 earnings that over 2.5 Mn new vehicles, including four-wheelers, two-wheelers and CVs, across ICE and EV segments, had built-in MapmyIndia Mappls in FY24, up 32% YoY.

On the other hand, MapmyIndia divides its product-wise revenue into two segments – map and data and platform and IoT. In FY24, its map and data revenue grew 23% YoY to INR 138 Cr and platform and IoT revenue jumped 42% to INR 241 Cr.

“We expect the company to maintain high margins driven by a pickup in loT-led business growth (offers more revenue opportunity for high-margin mapping), supported by newer opportunities in people/goods mobility and the auto aftermarket versus the legacy auto OEM business,” said Goldman Sachs in its research report.

“We offer incremental perspective on Mapmyindia’s loT margin potential and contrast how profitability evolved at similar hardware led businesses at peers like Trimble, and assess growth optionality from rising SUV + EV penetration,” the brokerage added.

MapmyIndia’s operating revenue stood at INR 379.4 Cr in FY24, witnessing a 35% YoY jump. Its profit after tax increased 25% YoY to INR 134.3 Cr in the last fiscal.

Shares of MapmyIndia were locked at the 20% upper circuit on the BSE today and ended the day’s trading at INR 2,401.9.

The stock is currently trading 23.5% higher year to date.

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