Shares of Infibeam Ltd, an e-commerce player in India saw a sharp fall on Monday morning. The shares tumbled by more than 48% to hit the day’s low at Rs 87.15, after opening at Rs 142.85. However, despite investors dumping their positions in the stock, research and brokerage firm KR Choksey sees a lot of opportunity in the stock. KR Choksey says that the scrip is a value buy at the these levels, as Infibeam is a fundamentally strong company. KR Choksey says the target price for the stock is Rs 209, more than double of what it’s trading at currently!
The company made news after the stock split from the face value of Rs 10 to Rs 1 per share on August 31 thereby reducing the share price by 10 times. Analysts say that this was done to improve the liquidity of equity shares with higher floating stocks and to make them more affordable to the investors. Infibeam Incorporation Limited is engaged in providing software development services, maintenance, Web development, e-commerce and other ancillary services. The company’s segments include sales of products, and sales of software and e-commerce related ancillary services.
Vetri Subramaniam of UTI AMC sees a lot of opportunity for the retail as well as the e-commerce players in India. Last week, the veteran pointed out to ET Now, “One could arguably make the case that the share of organised retail in this economy will continue to grow and the share of e-commerce will continue to grow as well.” The expert believes that the continued preference for online channel as opposed to retail in the United States has caused a dip in market capitalization for the retail segment which was built over the last 60-70 years. Shares of Infibeam made a sharp recovery after the 48% fall, and were trading at Rs 125.9 reversing losses of more than 30%. The midcap stock has returned 22% in the year so far, as opposed to the BSE Midcap index which is up by more than 29%.