India Internet - IIC '21 Takeaways - Faster, Higher, Stronger

19 April 2021 | 7:40PM IST
India Internet
IIC ‘21 takeaways: Faster, higher, stronger
Faster growth rates, higher margins and stronger balance sheets were the key Manish Adukia, CFA
+91(22)6616-9049 |
messages at our India Internet Conference 2021 (IIC ‘21). Growth rates for India manish.adukia@gs.com
Goldman Sachs India SPL
internet companies remain elevated — the average growth rate for companies at IIC
Piyush Mubayi
‘21 was c.100% vs. pre-COVID levels — and we expect some of these trends to +852-2978-1677 |
piyush.mubayi@gs.com
sustain in FY22. We forecast India internet GTV1 to reach US$185 bn by FY25E (c.3x Goldman Sachs (Asia) L.L.C.
of FY21), translating into a 31% FY21-25E CAGR. While companies have been able
For the exclusive use of CHRISTINE.MENEZES@TIMESGROUP.COM
to improve unit economics, we remain skeptical regarding sustainability of these

profit trends, especially in light of the strong capital raising activity in recent weeks.
We see ecommerce as the biggest battleground for India internet (contributing
64%/44% of FY25E GTV/profits), but expect expanding profit pools across food-tech,
edtech, B2B, etc. At IIC ‘21, we hosted 13 companies across multiple verticals, and
we see positive read-across for the covered stocks in our India internet universe:
MakeMyTrip (Buy rated), Reliance Industries (Buy rated, on CL) and Info Edge (Sell
rated).
Growth: On track for 3x scale over next four years
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Across most internet verticals (except travel), revenues/GMV is seeing robust trends;
the average growth rate for the 13 companies we hosted at IIC ‘21 was c.100% vs.
pre-COVID levels. The biggest beneficiaries of this uplift in growth continue to be
sectors such as education, ecommerce (incl. grocery) and entertainment, among
others. However, for the full year FY21, growth for overall India internet was flat YoY,
as uptick in ecommerce, education, etc. was offset by a decline in travel and
ride-hailing. We make modest changes to our India internet estimates, and now
forecast GTV (gross transaction value) to reach US$185 bn by FY25E (c.3x of FY21;
earlier estimate of US$180 bn), translating into a 31% FY21-25E CAGR (25%
FY20-25E CAGR).
1
Gross Transaction Value
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analysts with FINRA in the U.S.
Goldman Sachs India Internet
Table of Contents
India Internet: A US$185 bn opportunity 4
A pulse check of the ecosystem 4
Ecommerce: Strong growth to sustain in FY22 8
Read-across for covered stocks 10
Company-specific takeaways 12
Swiggy 13
Udaan 14
Meesho 15
PharmEasy 16
Pepperfry 17
Shadowfax 18
Vedantu 19
Urban Company 21
Zerodha 22
Info Edge 22
MakeMyTrip 23
Profiles of private internet companies 26
Global internet valuations 27
Disclosure Appendix 29
19 April 2021 2
Closer to profitability, but steady-state margins some time away

India internet companies have indicated that they are either already profitable, or close
to profitability. However, we remain skeptical regarding sustainability of these profit
trends, especially in categories which do not have a clear market leader, and also have
low levels of online penetration. At low levels of online penetration, market shares can
shift quickly, and thus it is hard for platforms to maintain discipline on promotion spends.
Our FY25 net income estimate for the India internet sector remains broadly unchanged
at US$8.6 bn (was US$8.5 bn), and we believe steady state margins might still be
4-5 years away.
Capital activity elevated; companies increasingly talking about IPOs

Capital inflows into India’s internet ecosystem continue to be elevated. In the month of
April alone, we have seen six companies become unicorns (privately held companies
with >US$1 bn in valuation), compared to 12 such companies in all of 2020 (10 unicorns
YTD so far in 2021). In the first four months of CY21, Indian startups have raised
more than US$4.5 bn in capital, broadly tracking in line with full year CY20 when
US$11.5 bn was raised by the ecosystem. We believe such fund-raising activity could
potentially lead to an increase in competitive intensity in certain verticals, especially
segments where online penetration is low. In addition, most private companies we have
interacted with in recent months have said that they will soon be ‘IPO-ready’, with a
significant number of startups mentioning they would be looking to IPO over the
next 12-24 months.
FY22 to be another strong year for ecommerce, but high competition in grocery
We believe FY22 will be another strong year for ecommerce in India, and forecast 32%
YoY growth in GMV, with c.90% YoY growth in online grocery. Overall, we expect
ecommerce to reach US$119 bn by FY25E, almost 3x vs. FY21 levels, with grocery
reaching US$37 bn by FY25E, 8x of FY21 levels. However, we expect competition to
remain high, especially in online grocery; a number of platforms have increased their
focus on this category given large TAM and low penetration, and we believe online
grocery could remain loss making for another 2-3 years.
Positive read-across for covered stocks

A faster shift to online and improving unit economics bode well for the covered
stocks in our India internet universe: MakeMyTrip, Reliance Industries and Info Edge.
While near-term recovery path for MakeMyTrip is likely be volatile, we see MMYT to be
a beneficiary longer term of shift to online, and market share consolidation; we reiterate
Buy. We forecast 50% market share for Reliance Industries in online grocery by FY25E,
with c.30% market share in overall ecommerce; in our view, the company’s
omni-channel approach will result in RIL being able to increase online scale, while
keeping losses under check; we remain Buy (on CL). For Info Edge, most of its verticals
are now tracking in line or higher vs. pre-COVID levels. That said, our FY22E-24E
classifieds revenue forecasts for Info Edge are still about 15% lower vs. the estimates
we had a year ago (pre-COVID); we see a mismatch between growth outlook and
valuations and remain Sell rated.
19 April 2021 3
India Internet: A US$185 bn opportunity

Exhibit 1: We expect India internet GTV to reach US$185 bn by FY25E
India Internet Landscape
Food & Gaming & Advertise- Fintech/ India

E-comm Travel Education
ride-hailing OTT/video ment Payments Internet
FY20 $2.3 $2.3 $61

GTV $33 bn $16 bn $7 bn $1 bn NA
bn bn bn
FY20-25E
29% 14% 20% 30% 18% 48% NA 25%
CAGR
FY25E $119 $185

$30 bn $17 bn $9 bn $5 bn $5 bn NA
GTV bn bn
Take rate* 11% 8% 25% 25% NA NA NA NA
FY25E $2.3 $4.3 $6.3 $2.5 $69

$44 bn $5 bn $5 bn
revenue bn bn bn bn bn
Profit* margin 8% 12% 14% 18% 23% 22% 20% 12%
FY25E $3.8 $0.3 $0.6 $1.1 $1.2 $1.1 $0.5 $8.6

profits bn bn bn bn bn bn bn bn
Assumed
30x 30x 30x 30x 25x 30x 30x*
multiple
Valuation $113 $257

$8 bn $18 bn $34 bn $31 bn $33 bn $20 bn
(FY24E) bn bn
Time to
2-3 years 0-1 year 0-1 year 2-3 years Profitable Profitable 3-4 years
profitability
Amazon, MMYT, Swiggy, TIL, Byju's, Paytm,

Key players Google,
Flipkart, Oyo, Zomato, Dream11, Unacademy PhonePe,
Facebook
RIL Booking Ola, Uber YouTube , Vedantu Google
The above list of segments is not exhaustive. Advertisement revenues exclude OTT and ecommerce advertising, but include classifieds. Food delivery excludes advertisements, B2B, hyper-local, etc.
*For take rate, ecommerce shown is for 3P; for gaming, the take rate is for transaction gaming. *Profit represents net income, assuming segments reach steady state by FY25E. Assumed 30x multiple in
line with global internet peers, except advertising, where a 25x multiple is in line with advertising peers. *We value payments at 10x EV/Sales. We do not include payments GTV here to avoid double
counting. Valuation in the chart refers to potential cumulative implied market value of all the firms within that sector by FY24E (March 2024), based on FY25E net income/sales and assumed multiples as
discussed above. ‘Key players’ represent the largest players in each segment in terms of one or more of the following: GTV, revenue, transactions, traffic share (all based on latest available data). INR
USD rate of 75. FY represents year ending March.
Source: Euromonitor, Company data, FICCI-EY, Goldman Sachs Global Investment Research
A pulse check of the ecosystem
Our conversation with India internet companies at IIC ‘21 (Goldman Sachs India Internet
Conference 2021) suggests adoption of online continues to accelerate, and COVID-19
has resulted in a new set of transacting users coming online, helping penetration reset
higher. Across most internet verticals (except travel), revenues/GMV is trending higher
vs. pre-COVID levels; the average growth rate for the 13 companies we hosted at IIC
‘21 was c.100% higher vs. pre-COVID levels (Exhibit 2).
The biggest beneficiaries of this uplift in growth continue to be sectors such as

education, ecommerce (incl. grocery) and entertainment, among others. We make
modest changes to our India internet estimates, and now forecast GTV (gross
transaction value) to reach US$185 bn by FY25E (vs. earlier estimate of US$180 bn),
19 April 2021 4
translating into a 31% FY21-25E CAGR (25% FY20-25E).
Across the board, companies in the India internet ecosystem we hosted at IIC ‘21 have
indicated that they are either already profitable, or close to profitability, driven by decline
in competitive intensity as a result of COVID-19. However, we remain skeptical
regarding sustainability of these profit trends, especially in categories which do not have
a clear market leader, and also have low levels of online penetration. At low levels of
online penetration, market shares can shift quickly, and thus it is hard for platforms to
maintain discipline on promotion spends. Our FY25 net income estimate for the India
internet sector remains broadly unchanged at US$8.6 bn (was US$8.5 bn). We
expect ecommerce (including grocery) to make up 44% of this profit pool.
Exhibit 2: Average growth rate of internet companies has been 100% vs. pre-COVID over the last few months
Current GMV/revenue/volumes vs. pre-COVID for companies we hosted at IIC ‘21
7.0x 7.0x
6.0x 6.0x
5.0x 5.0x
4.0x 4.0x
3.0x 3.0x
Average scale c.2x vs pre-COVID

2.0x 2.0x
1.0x 1.0x
0.0x 0.0x
MMYT Swiggy Pepperfry Info Edge Rebel Times Udaan PharmEasy Urban Shadowfax Zerodha Meesho Vedantu
(Travel) (Food (Home (Listings) Foods Internet (B2B (Health) Company (Logistics) (Stock (Ecomm - (Edtech)
delivery) ecomm) (Cloud ecomm) (Home broking) social)
kitchen) services)
MMYT shows GSe for 4QFY21E bookings YoY; current GMV for Swiggy; 2HFY21 YoY revenues for Pepperfry; Dec quarter billings YoY for Info Edge; current India revenues for Rebel Foods; current
revenue run rate vs. FY21 full year for Times Internet; last 12 months growth for PharmEasy; current revenues vs. pre-COVID peak for Urban Company; Mar ‘21 YoY GMV for Udaan; Mar ‘21 revenue run
rate for Shadowfax; FY21 revenue growth per management for Zerodha; Mar ‘21 volumes for Meesho; and 2020 revenue growth for Vedantu.
Source: Company data, Goldman Sachs Global Investment Research
19 April 2021 5
Exhibit 3: App downloads data suggest high user engagement across categories such as grocery, ecommerce, education
App downloads in 1QCY21 vs. 1QCY20 in India
2.0x
2.0x
1.3x
1.2x
1.0x
1.0x 1.0x 1.0x
0.9x 0.9x
0.7x
Online travel Payments Video Food delivery Ride hailing Healthtech Classifieds Music Grocery (incl. Ecommerce Edtech
streaming Jio mart)
The list of apps used is not exhaustive.
Source: SensorTower, Data compiled by Goldman Sachs Global Investment Research
ecommerce: Growth momentum to sustain

Given restrictions on offline retail due to COVID-19, ecommerce platforms continue to
see robust adoption (33% YoY growth in FY21). We believe FY22 will be another strong
year for ecommerce in India, and forecast 32% YoY growth in GMV, with c.90% YoY
growth in online grocery. Overall, we expect ecommerce to reach US$119 bn by
FY25E, almost 3x vs. FY21 levels, with grocery reaching US$37 bn by FY25E, 8x of
FY21 levels.
We expect ecommerce (including grocery) to be the biggest battleground for India

internet companies. Within grocery, a number of platforms now compete, with the key
ones being grocery-only online players (Grofers, Bigbasket), horizontal ecommerce
platforms (Amazon, Flipkart), omni-channel retailers (Reliance Retail, etc.), and food
delivery platforms (Swiggy). Recently, even Meesho has launched a community buying
platform for grocery called farmiso.
However, we believe RIL remains best positioned given its omni-channel approach. In
addition, for non-grocery categories, RIL’s ability to operate an inventory-based model
could give it an edge vs. other ecommerce platforms. We forecast 50% market share
for RIL in online grocery by FY25E, with c.30% market share in overall ecommerce.
Food delivery: Outlook robust, but growth lagging global peers

Both Swiggy and Rebel Foods mentioned that their GMVs are back to pre-COVID levels;
however, we note that growth for online food delivery in India has materially
underperformed global peers, where growth rates are ranging from 40% to 230% YoY,
19 April 2021 6
vs. India at close to 0-10% YoY (Exhibit 4). We believe some of this can be attributed to
the urban population in India migrating to their hometowns during the pandemic, in
addition to lesser prevalence of the ‘eating-out’ culture in India as well as supply-side
constraints.
Food delivery platforms in India are trying to build use cases on top of their food delivery
businesses. For example, Zomato offers restaurant discovery and table reservation, in
addition to restaurant supplies services. On the other hand, Swiggy has been increasing
its focus on hyper-local services – from food delivery to online grocery to daily milk
delivery, among others. Given the pressure on brick and mortar restaurants (per Swiggy,
c.20% of restaurants have permanently shut down), we believe the outlook for cloud
kitchens also remains quite robust in the near term.
We forecast US$10.5 bn in GTV for online food delivery (excl. grocery, B2B, etc.) in
India by FY25E, translating into a FY21-25E CAGR of 30% (FY20-25E CAGR of 23%). We
expect steady-state EBITDA margins of c.20% for the industry, translating into an
EBITDA pool of c.US$500 mn by FY25E (assuming 28% take rate).
Exhibit 4: Growth in food delivery in India has significantly

underperformed global peers
Growth in food delivery GMV (4QCY20 vs. 4QCY19)
250%
200%
150%
100%
50%
0%
Doordash (US) Uber (US) Just Eat Meituan (China) India food
Takeaway delivery
(Europe) (average)
For JET, numbers are 2HCY20 YoY, whereas for India, the numbers are for 1QCY21 (YoY).
Source: Company data, Goldman Sachs Global Investment Research
Education: A structural beneficiary

According to Vedantu (live tutoring platform for K-12), its paid user base has grown by
more than 5x in 2020. Byju’s too has seen significant traction on its platform during the
last 12 months. AST (after-school tutoring) in India is a c.US$15 bn industry (GSe), of
which less than 10% is online. With the pandemic resulting in restrictions on mobility,
we believe adoption of online education will likely continue to accelerate. We forecast
the industry to reach US$5 bn in revenues by FY25E, translating into a 37% FY21-25E
CAGR (48% FY20-25E CAGR).
19 April 2021 7
Ecommerce: Strong growth to sustain in FY22
Despite a month of complete lockdown for non-essential deliveries, ecommerce in

India grew 33% YoY in FY21 (March 21), the highest in three years, reaching US$44 bn
in GMV, implying online penetration reaching 6.9%. Categories such as electronics &
appliances, and fashion/apparel saw 600-700 bps increase in YoY penetration (per
Euromonitor), while online grocery grew at more than 100% YoY in FY21, reaching
around US$4 bn in GMV. In recent days, India has seen a surge in COVID cases,
resulting in mobility restrictions in certain parts of the country. We believe FY22 will be
another strong year for ecommerce in India, and forecast 32% YoY growth in GMV
(Exhibit 5), with c.90% YoY growth in online grocery.
Overall, we expect ecommerce to reach US$119 bn by FY25E, almost 3x vs. FY21

levels, implying online penetration of 13%, twice vs. current levels (Exhibit 6). We
forecast grocery to drive 40%+ of the incremental growth (Exhibit 9), reaching US$37
bn by FY25E, 8x of FY21 levels.
However, we expect competitive intensity in online grocery to intensify, given the large
category size (>US$400 bn total grocery market in 2020), and low online penetration
(c.1%). In recent weeks, press reports have indicated that the Tata Group, one of India’s
largest conglomerates, is likely to foray into online grocery through their acquisition of
BigBasket, while Amazon could significantly expand its grocery footprint in India. We
believe multiple players with different business models can co-exist in online grocery
(given the large TAM), but note that RIL remains best positioned given its omni-channel
approach, which in our view, will help it attain both improved reach and better unit
economics.
Apart from B2C ecommerce, we see B2B ecommerce as another large opportunity for
internet platforms. Per Udaan (a B2B ecommerce platform), India’s B2B market has a
GMV of US$900 bn as of 2020, of which less than 1% is online. Udaan has a GMV of
US$2.3 bn as of Mar ‘21, having grown 100% over the last two years, and expects a
TAM of c.US$100 bn by 2030. In healthcare, API Holdings (PharmEasy) is the largest
B2B platform, with US$1 bn of annualised GMV (in addition to B2C); the company is
looking to more than double its geographical footprint over the next 12 months.
19 April 2021 8
Exhibit 5: We expect industry growth rate in FY22 to sustain at the Exhibit 6: Change in online penetration in FY21 was higher than that
elevated level seen in FY21, with India’s ecommerce growing c.3x in the previous two years put together
over next 4 years India ecommerce penetration (as % of total retail), and YoY change in
India ecommerce (US$ bn) and YoY growth penetration
42%
1.7%
1.6%
1.6%
33% 32% 1.3%

1.3%
29%
27% 27%
26%
24%
0.8%
0.8%
0.7%
21 27 33 44 58 74 94 119 3.8% 4.5% 5.3% 6.9% 8.2% 9.5% 11.1% 12.9%
FY18 FY19 FY20 FY21 FY22E FY23E FY24E FY25E FY18 FY19 FY20 FY21 FY22E FY23E FY24E FY25E
India ecommerce (US$ bn) YoY growth Ecommerce penetration YoY change
FY21 indicates year ended March 2021. INR USD of 75. FY indicates year ending March.
Source: Euromonitor, Goldman Sachs Global Investment Research Source: Euromonitor, Goldman Sachs Global Investment Research
Exhibit 7: India has one of the lowest ecommerce adoptions among Exhibit 8: Online penetration in India lower vs. peers in most
peers, but we expect this number to double over next four years categories, with just 1% penetration in grocery
Ecommerce penetration in CY20 Online penetration by category for e-commerce (CY2020)
80%
36%
70%
China
27%
60% USA
24%
India
20% 50%
14% 14% 40%

13% 13%
11% 10%
30%
7%
20%
10%
0%
Consumer Apparel & Consumer Beauty & Grocery
electronics footwear appliances personal care
FY25E is year ending March 2025. Source: Euromonitor, Goldman Sachs Global Investment Research
Source: Euromonitor, Goldman Sachs Global Investment Research
19 April 2021 9
Exhibit 9: We expect grocery to drive 40%+ of incremental GMV Exhibit 10: App downloads data suggest traction for JioMart
growth until FY25E continues to be higher vs. peers, but momentum is likely slowing
FY25E vs. FY21 India e-commerce market size by category (US$ bn) down
App downloads per week in India (in ‘000) for online grocery platforms
1,500 1,500
$13 bn $119 bn
$15 bn 1,200 Grofers 1,200

$14 bn Bigbasket
$33 bn 900 Jiomart 900
$44 bn 600 600
300 300
0 0
FY21 market Grocery Apparel & Electronics & Others FY25E India
size footwear appliances ecommerce
market size
FY21 indicates year ended March 2021. INR USD of 75.

Source: SensorTower, Data compiled by Goldman Sachs Global Investment Research

Source: Euromonitor, Goldman Sachs Global Investment Research
Read-across for covered stocks
MakeMyTrip: Near term uncertain, but beneficiary of share gains; Buy

Virus cases in India have seen a sharp uptick in recent days, resulting in reduced
mobility and travel; thus, the near-term recovery path for MMYT will likely be volatile.
However, we continue to expect domestic travel demand to reach pre-COVID levels
by Dec ‘21, largely as a result of ramp-up in vaccinations; MMYT operates in the leisure
travel segment, and we do not foresee any structural change in consumer behavior for
this segment. In addition, our conversations with internet companies have suggested an
accelerated shift to digital payments and a higher sampling of online services in India.
Within travel, categories such as hotels, international travel, and bus travel, have online
penetration of less than 20%, and we believe a faster shift to online will benefit the
market leader MMYT.
We also expect MMYT’s strong balance sheet relative to peers to help the company
capture an additional 6 percentage points of market share in online travel over the
next three years. Lastly, a consistent theme across India internet has been the
improvement in unit economics due to COVID-19, and we see no reason why it should
be different for MMYT. MMYT’s valuation at 3.1x CY22E EV/Sales is more than 1
standard deviation below history; we reiterate Buy with a 12m target price of US$37,
implying 40% upside from current levels (more here).
Info Edge: Recovery robust but valuations remain stretched; stay Sell
Across most of its verticals, Info Edge is now tracking in line or higher vs. pre-COVID
levels. Recruitment is 57% of our Info Edge SOTP (70% of standalone revenues, Dec
‘20) and Naukri JobSpeak data suggests job listings in 1QCY21 are now at similar levels
vs. pre-COVID. That said, our FY22E-24E classifieds revenue forecasts for Info Edge are
still about 15% lower vs. the estimates we had a year ago (pre-COVID). In addition,
19 April 2021 10
except recruitment, competitive intensity is high in all of Info Edge’s key verticals, which
could result in profitability staying challenged in the near term for these verticals.
19% of our Info Edge SOTP is driven by Zomato, in which Info Edge has an 18% stake.
While food delivery GMV in India has recovered to pre-COVID levels, we note that
growth in India has materially underperformed global peers, where growth rates are
ranging from 40% to 230% YoY, vs. India at close to 0-10% YoY (Exhibit 4).
Info Edge is 2-4x more expensive vs. global peers on P/E and EV/EBITDA (CY21E), with
EPS and EBITDA growth (CY20-23E CAGR) 1.5-2x higher; we see a mismatch between
growth outlook and valuations. We stay Sell with a 12m target price of Rs2,610, implying
44% downside from current levels (more here).
Reliance Industries: Well positioned to gain market share in ecommerce; Buy (on CL)
Within its internet businesses, we are particularly constructive on RIL’s market share
gain potential in grocery/ecommerce. We believe FY22 will be another strong year for
ecommerce in India, and forecast 32% YoY growth in GMV for the industry, with c.90%
YoY growth in online grocery; we expect RIL to be a key beneficiary of this growth.
Press reports suggest RIL is already the largest online grocery platform in India, and we
believe the company’s omni-channel approach will result in further expansion of its
market share. In addition, for non-grocery categories, RIL’s ability to operate an
inventory-based model could give it an edge vs. other ecommerce platforms. We
forecast 50% market share for RIL in online grocery by FY25E, with c.30% market
share in overall ecommerce. This translates into US$35 bn ecommerce GMV for RIL
by FY25E, with US$19 bn in grocery. We remain Buy rated (on CL) with a 12m target
price of Rs2,405, implying 24% upside from current levels (more here).
19 April 2021 11
Company-specific takeaways
In the following sections, we detail company-specific takeaways from the thirteen

companies we hosted at our India Internet Conference (IIC) 2021. These companies
span multiple segments including travel, classifieds, food, healthcare, ecommerce,
fintech, and education, among others.
Unless otherwise stated, the company-specific sections are all management

comments, and not GS views/estimates.
Exhibit 11: We hosted the below companies during our India Internet Conference 2021
Overview of companies we met during our India Internet Conference 2021
Last round
Company Sector Details valuation/
market cap
Food delivery & c.40mn orders per month (pre-COVID). c.500 cities, c.200k riders. Also launched US$5 bn
Swiggy
hyper-local online grocery and has a cloud kitchen business (1H2021)
Operates 350+ kitchens across seven countries. Has 15 brands of its own, in
Food (Internet US$820 mn
Rebel Foods addition to operating third party brands. Generates US$100 mn+ in annual
restaurant) (2H2020)
revenues
GMV of US$2.3 bn as of Mar ‘21, across food & grocery, pharma, electronics,
Ecommerce US$3.1 bn
Udaan lifestyle, etc. User base of c.1.5 mn SMEs. 70% market share in B2B ecommerce
(B2B) (1H2021)
in India, per company
Ecommerce Network of 100k suppliers and 14 mn re-sellers, with cumulative end-customers
US$2.1 bn
Meesho (Social of 33 mn. Annualised GMV of US$1.5 bn as of Mar '21, processing c.20 mn order
(1H2021)
commerce) in the month
GMV run-rate of Rs8.25 bn (US$110 mn) a month, of which Rs6 bn is from the
PharmEasy US$1.5 bn
Health tech B2B arm, and Rs2.25 bn from B2C. Connected to 80k retailers (10% of all
(API Holdings) (1H2021)
pharmacies in India), and 3k distributors and manufacturers
Online marketplace for furniture and home interior products; also has 70 offline
Ecommerce US$462 mn
Pepperfry stores across 25 cities. Pepperfry has 70k listings on its platform, and 8 mn
(Furrniture) (1H2020)
registered users
Caters to multiple categories such as food delivery, grocery, online retail,
US$250 mn
Shadowfax B2B logistics medicines, FMCG, etc. Network of 55k monthly active delivery partners, and
(2H2019)
annual revenue run rate of US$100 mn (Mar '21)
Predominantly focused on K-12 segment including test preparation, and is a live US$600 mn
Vedantu Education (K-12)
tutoring platform. Paid user base of 250k (2H2020)
Home services platform with two main verticals being beauty (salon, grooming,
Urban US$933 mn
Home Services etc.) and home services (appliance repair, home repair, etc.). Facilitated US$230
Company (2H2019)
mn in annualized net transactions as of Mar '21 (service revenues)
Has businesses across news, entertainment, classifieds, fintech and education,
Times Internet Multiple verticals among others. 588 mn MAUs (125 mn DAUs), with US$231 mn in revenues in NA
FY21
Online stock broking platform, which has a client base of 5 mn in 2021. Revenues US$1 bn
Zerodha Fintech (broking)
of Rs11 bn in FY20, with PAT of Rs4.6 bn (1H2020)
Presence across recruitment (#1 market share), real etate, matrimony and US$8.1 bn
Info Edge Classifieds
education. Also has investments in Zomato and Policybazaar, among others (market cap)
Presence across hotels, air and buses, with 50%+ market share in online across US$2.8 bn
MakeMyTrip Online travel
all these categories (market cap)
We do not cover any of the companies listed under ‘Company’ above except for MakeMyTrip and Info Edge. ‘Last round valuation’ (implied valuations from the latest funding round) data from press
reports. ‘Details’ either from the company or press reports and data is for 2020 or latest available numbers.
Source: Company data, Press reports (Economic Times, Livemint, Entrackr, Techcrunch), Data compiled by Goldman Sachs Global Investment Research
19 April 2021 12
Swiggy
Swiggy is one of India’s largest food delivery platforms, and operates across four main
business lines: food delivery, cloud kitchens, hyper-local (incl. grocery) and milk delivery.
The company has a presence across c.500 cities in India, with c.200k riders on the
platform.
For our recent notes on Swiggy, please see here: October 2020, May 2020.
COVID-19 impact: Swiggy mentioned that business has recovered to pre-COVD levels
(in terms of GMV), but volume growth has likely gotten pushed back by three months
due to the new wave of COVID-19 (a certain part of user base remains dormant). On the
supply side, c.20% of restaurants have shut down; however, delivery-only restaurants
are increasing their footprint.
Competition: Swiggy sees Zomato as its primary competitor; per Swiggy, about
two-third users on its platform also likely use Zomato (and vice versa); Swiggy said it is
the market leader in the top ten cities whereas Zomato has some market share
advantage in tier two and three cities. Amazon has not materially scaled up its food
delivery business in India yet, per Swiggy.
TAM: Swiggy does not believe that the online food delivery platforms are taking share
from offline restaurants, but are expanding the organised food category in India. In other
developed markets, consumers eat 45-50 meals outside home, whereas in India, the
number is in low-single digits. Swiggy expects to acquire 25-30 mn new users every
year once the COVID situation normalises, and expects consumers in India to leapfrog
from home-cooked food to food delivery (given lack of eating out infrastructure). Swiggy
believes the online food industry in India can grow 30%-50% annually over the next few
years.
Grocery: Swiggy is seeing material tailwinds for both its morning milk delivery business
(Supr Daily, in six cities), and the recently launched on-demand grocery delivery
(Instamart). Swiggy believes Instamart is a unique offering, with delivery time of c.30
mins; this has been launched in Bangalore and Gurgaon so far and the company will
expand coverage to 10 cities by the end of 2021. Swiggy is operating an inventory model
for grocery, with about 3k SKUs across 5-6 categories including fruits & vegetables. The
company expects last mile delivery costs in grocery to be c.20% lower vs. that in food
delivery, given higher opportunity to batch orders. Compared to other grocery platforms,
which have last mile delivery costs of c.Rs150 per order, Swiggy expects this cost to be
<Rs50 on its platform.
Swiggy foresees limited competition in this space: the company is targeting high
frequency (daily/weekly purchase), low AOV transactions, and will use a network of dark
stores for last mile delivery (within 3-4 kms of consumer). Swiggy expects grocery
ecommerce to see material growth over the next three years, and believes multiple
business models can co-exist.
Cloud Kitchens: This business continues to get impacted from COVID-19; Swiggy
19 April 2021 13
paused operations in a few kitchens during the pandemic, and given current trends,
re-opening/recovery might be further delayed. There has been an increase in private
investments in creating cloud kitchen infrastructure, and thus Swiggy is not likely to
make fresh investments here. On private brands, Swiggy will continue to try to create
categories where it thinks there are white spaces.
Economics: Basket sizes in food delivery have stayed at the higher levels achieved
during the pandemic, but Swiggy expects this to come down as volume growth
accelerates; take rates (commission + delivery fee + advertisement) can settle at around
32%-33% over time. The business is close to profitability; however, investments in
marketing and customer acquisition could go up in the near term.
Others:
n One-third of Swiggy’s business comes from outside the top 10 cities, but Swiggy is
expecting material growth from the top 10 cities as well. Per the company, only
30%-35% of its TAM (of 200 mn consumers in 500 cities) has been penetrated by
the food delivery platforms.
n Restaurants generate 10%-30% cash margins on incremental orders received
through food delivery platforms.
n Over time, Swiggy would like to have a 50-50 revenue split from food delivery and
other verticals (grocery, etc.).
n The company is not looking to foray into chronic medicine delivery, but could help
with OTC medicine delivery though either Instamart or Genie platforms.
Udaan
Udaan is a horizontal B2B ecommerce platform, with GMV of US$2.3 bn as of Mar ‘21,
spread across categories such as food & grocery, pharmaceuticals, electronics, lifestyle
and general merchandise. The company has a user base of c.1.5 mn SMEs, and reaches
more than 1,000 cities in India. Per Udaan, it has a 70% market share in B2B
ecommerce in India.
The business: Udaan’s core strategy is to focus on wallet growth of buyers through a
play of commerce, logistics and lending. Udaan operates in trade and wholesale
(consumer) categories, and not in industrial categories. The company has an inventory
model for categories such as grocery and pharma, whereas for lifestyle, home &
kitchen, the model is largely 3P. Udaan is a volume-driven business; an average Udaan
buyer places 100+ orders every year, whereas on B2C ecommerce platforms, an
average consumer buys 3-4 times a year. The company sees Flipkart, Amazon and
Reliance as its key competitors.
Credit & logistics: Udaan also helps with credit and logistics on its platform, and
believes these are core to building B2B ecommerce in India. Per Udaan, India is heavily
reliant on trade credit, but 90% of trade credit is financed by non-financial services
platforms. Udaan believes it is uniquely positioned to facilitate credit to the SMEs on its
19 April 2021 14
platform, as its cost of customer acquisition and cost of collection is likely to be lower
vs. other players. Udaan disbursed over US$1 bn in credit last year through its platform.
TAM: Per Udaan, small businesses in India spend about US$900 bn annually towards
their product purchases, of which 90%-95% is unorganised supply, and online
penetration is less than 1%. Per Udaan, this addressable market can rise to US$1.4 tn
by 2030, of which it believes 5%-10% can be organised, representing a US$100 bn
opportunity for Udaan. India’s distribution chain (wholesale and retail) is quite
fragmented, and Udaan believes ecommerce will be the primary driver of the shift from
unorganised to organised retail in India.
On a blended basis, distribution take rate in India is around 8%-10% per Udaan. Take
rates in B2B commerce range from 4% to 30%, with categories such as lifestyle, home
& kitchen, accessories, toys, general merchandise, footwear, etc. at around 15%-30%
take rates, and categories such as smartphones, consumer durable, etc. at 4%-7% take
rates. FMCG take rates are at around 6%-10%, staples in the range of 3%-5%, and
fresh food around 10%-40%. In the food business, Udaan is in 50 cities, looking to
expand to 80 cities by end of CY21, and to 300 cities over the next couple of years.
Meesho
Meesho is a social commerce platform, positioning itself as a channel for the next 500
mn users in India. The company has a network of 100k suppliers and 14 mn users
(re-sellers), with cumulative end-customers of 33 mn across 26k+ pincodes in India.
Meesho has an annualised GMV of US$1.5 bn as of Mar ‘21, with the company
processing c.20 mn orders in the month (6x vs. last year).
For our earlier note on Meesho, please see here: October 2019.
The business: Meesho acts as a marketplace between suppliers and users (re-sellers).
Re-sellers can source catalogs from 100k suppliers, and share these catalogs with their
network through social media networks. Meesho helps them with the logistics and
payments network, and these re-sellers take no inventory risk (inventory remains with
the supplier).
85% of Meesho’s transactions happen through WhatsApp and the company is not
focused on branded products such as consumer durables, mobile phones, etc.; Meesho
has more than 6 mn SKUs (target of 16 mn by end of CY21) on its platform across 100+
categories. Per Meesho, it has a >90% market share in social commerce, and gets
>80% of its orders from outside Tier 1 cities. The company believes there is very limited
overlap between buyers on the Meesho platform vs. that on Amazon/Flipkart.
Meesho has also recently launched two new initiatives called farmiso and popshop.
farmiso is a community buying platform for fruits & vegetables, whereas popshop is a
C2C marketplace. Meesho believes its farmiso business model can solve for the
last-mile costs of grocery (by distributing it across multiple buyers), which is a key
bottleneck to making economics work in grocery.
19 April 2021 15
TAM: Meesho sees its addressable target market as the unorganised retail segment,
which per the company made up US$748 bn of the US$850 retail market in 2020. This
unorganised retail market remains largely offline, per Meesho, with less than 1% online
penetration in 2020; Meesho expects this to reach 10% online penetration by 2025,
translating into a US$100 bn TAM for the company.
Others:
n Meesho has raised a total of US$490 mn of capital so far, of which it currently has
US$405 mn of cash on its books. The company does not have a definite timeline for
a potential IPO at this point.
n Average order value on the platform is around US$6.
n 90% of orders are through cash-on-delivery.
n Meesho operates an asset-light model and its logistics is outsourced; 90% of orders
are fulfilled within 5 days.
PharmEasy
API Holdings (the parent company of PharmEasy) is the largest digital healthcare
platform in India and is positioning itself as a one-stop solution for all out-patient needs
of a consumer. API Holdings has a GMV run-rate of Rs8.25 bn (US$110 mn) a month, of
which Rs6 bn is from its B2B arm, and Rs2.25 bn is from its B2C arm. Per API Holdings,
it is the market leader in both these verticals.
For our earlier notes on PharmEasy, please see here: March 2021, September 2020, and
June 2019.
The business: API Holdings’ B2B platform is connected to 80k retailers (10% of all
pharmacies in India), and 3k distributors and manufacturers. The B2C platform connects
more than 1 million consumers. API Holdings also facilitates 500k consultations a
month, and has digitized 4k+ clinics across India. 20% of doctors in India see 80% of
the patients, but consultation fee is low and doctors do not necessarily need online
platforms for demand generation. Thus, API Holdings is focusing on digitizing the doctor
clinics, and does not intend to monetize this.
API Holdings aims to expand its footprint to 120k retailers over the next 12 months. The
company had presence in 30 cities last year, which has now grown to 114 cities; API
Holdings is targeting presence in 250 cities over the next 12 months.
The Industry: The total pharma market in India is about US$25 bn, of which
US$600-700 mn has moved online (excluding B2B) according to API Holdings. In some
cities, API Holdings has a meaningful market share of the overall market (in B2B); for
example, in Gurgaon, c.40% of all medicine GMV is sold through its platform, while the
same numbers are 20% and 15% for Bangalore and Mumbai, respectively.
Competition: API Holdings is not competing on the basis of capital, and believes its
full-stack healthcare approach could help it defend and grow market share; the company
19 April 2021 16
believes multiple players can co-exist in India’s digital health market. API Holdings looks
at itself not just as an online pharmacy, but also a part of the digital B2B supply chain.
Logistics (B2C): API Holdings fully owns the last mile logistics in about 50 cities that
contribute c.75% to its demand; the company is looking to expand this footprint to over
100 cities over the next 1-2 years. Average delivery time in metro cities is less than four
hours, with delivery times of 30-90 mins on payment of a small fee (in some cities).
Logistics cost is about US$0.5 per delivery for API Holdings in the B2C segment.
Economics: API Holdings has grown 75%-80% last year (60%-90% growth over the
last three years), and the company expects to grow 50%-60% over the next 12 months.
It is contribution margin positive in its B2C business, and believes in a steady state,
contribution margins can reach mid-teens in this segment. In the B2B segment,
contribution margin could be mid-to-high-single digits in a steady state. On a blended
basis, this translates into high-single-digit to low-double-digit margin.
The company’s key investment areas are likely to be: (1) Increasing footprint of retailers;
(2) increasing consumer traction through brand creation, etc.; (3) partnering with doctors
and hospitals; and (4) new initiatives such as diagnostics, insurance, etc.
API Holdings has no specific plans for an IPO in the near term.
Pepperfry
Pepperfry operates an online marketplace for furniture and home interior products; the
company has an omni-channel approach (70 offline stores across 25 cities), and operates
an end-to-end supply chain. Pepperfry has 70k listings on its platform, and has 8 mn
registered users.
For our earlier notes on Pepperfry, please see here: October 2019 and June 2019.
The business: Pepperfry acts as a marketplace for vendors (does not own inventory);
however, about 50% of Pepperfry’s business comes from its own private labels. Private
labels can be thought of as brand licensed products, where Pepperfry helps co-design
with merchants, and then merchants manufacture and list these products on the
platform. On an overall basis, Pepperfry’s take rate is 55%, while the number is 65% for
its private labels.
The company does not sell from its offline stores; however, studio-aided customers
have AOVs which are 2.8x of customers who buy directly online on Pepperfry, in
addition to a higher repeat rate. On a blended basis, Pepperfry’s AOV (average order
value) is US$180.
The landscape: The home furniture & decor market in India is a US$21 bn category as
of 2019 (US$26 bn in 2021, per Pepperfry), of which only about US$2.3 bn (c.10%) is
organised, according to Pepperfry. Per Pepperfry, it is the market leader in the online
furniture category, and the company has so far not seen a change in competitive
intensity due to RIL’s acquisition of Urban Ladder. Pepperfry’s products are 20%-30%
19 April 2021 17
cheaper vs. the unorganised sector as well as competitors such as Ikea (on a
comparable basis).
Economics: Pepperfry has been growing topline at a 37% CAGR over the last five years
(3x the pace of the category), and expects 35%-40% CAGR over the next 3-4 years.
Pepperfry has seen a YoY growth in 2HFY21, but full year FY21 was a small decline YoY
due to the initial negative impact of COVID-19.
Over the last four years, Pepperfry has reduced losses by 80%-85%, and expects to
reach EBITDA breakeven in the next few months; the company expects
early-to-mid-teens EBITDA margin by FY25E.
Others:
n The company’s supply-chain cost is in single digits percent, with average delivery
time of 7-8 days. Returns and cancellations are also in single-digit percent on the
platform.
n c.80% of the traffic on Pepperfry’s platform is organic, vs. c.40% pre-COVID.
n On an average, a customer on Pepperfry does 2.4 transactions over a period of 24
months.
n Beds, dining tables and sofas each are about 18%-22% of Pepperfry’s revenues.
n Pepperfry said it is planning an IPO over the next 12-18 months.
Shadowfax
Shadowfax is one of India’s largest B2B last mile logistics platforms (crowdsourced),
catering to multiple categories such as food delivery, grocery, online retail, medicines,
FMCG, etc. Its customers include platforms such as Swiggy, Zomato, Amazon and
Flipkart, among others. Shadowfax has a network of 55k monthly active delivery
partners (40k weekly active) on the platform. The company has a current annual revenue
run rate of US$100 mn (Mar ‘21), c.100% higher vs. pre-COVID levels.
For our earlier notes on Shadowfax, please see here: April 2020, October 2019, and
June 2019.
The business: Shadowfax is present across 600+ cities in India, and delivers 413k
orders per day. The company operates an asset-light model, without any material infra
ownership. Shadowfax thinks of its business in two buckets: hyperlocal (point-to-point
delivery), and ecommerce (hub-and-spoke delivery). Hyperlocal, which includes food
delivery, grocery, FMCG & medicines, makes up 50%-55% of Shadowfax’s revenues;
ecommerce is about 35%-40% of revenues, while the remaining is B2B. Shadowfax’s
largest client contributes 12%-14% of its revenues, while the top ten clients contribute
65%-70% of total revenues.
Flipkart’s entire grocery/hyper-local delivery is being managed by Shadowfax, which

Shadowfax believes will be one of the key growth drivers for the latter; Flipkart is also a
minority investor in Shadowfax. For ecommerce, Shadowfax offers end-to-end deliveries
19 April 2021 18
for customers including reverse logistics.
The landscape: Shadowfax operates in the following four categories.
1. Food delivery: Industry size of 2.1mn shipments a day across different platforms, of
which 90% is managed in-house. Shadowfax has 80% share of the remaining,
contributing US$27 mn to revenues in Mar ‘21 (annualised; 4.2x vs. Mar ‘20).
Shadowfax expects industry volumes to grow 6x to 13 mn orders per day by FY26,
with c.18x rise in Shadowfax’s revenues from this segment over this period.
2. Grocery, FMCG & Pharma: Industry size of 2.3 mn shipments a day across different
platforms, of which 80% is managed in-house. Shadowfax has 83% share of the
remaining, contributing US$21 mn to its revenues (1.7x vs. Mar ‘20). Shadowfax
expects industry volumes to grow 6x to 14 mn orders per day by FY26, with c.19x
rise in Shadowfax’s revenues from this segment.
3. E-commerce: Industry size of 6.5mn shipments a day across different platforms, of
which 60-70% is managed in-house. Shadowfax has 15% share of the remaining,
contributing US$40 mn to its revenues (2.7x vs Mar ‘20). Shadowfax expects
industry volumes to grow 3x to 18.5 mn orders per day by FY26, with c.13x rise in
Shadowfax’s revenues from this segment.
4. B2B: Shadowfax has US$7 mn revenues from this segment in ‘Mar 21 (3.5x vs. Mar
‘20), which it expects to rise c.19x to US$129 mn by FY26.
Competition: Competitors such as Delhivery, Ecom Express, Blue Dart etc. do not
participate in the hyper-local delivery segment, and Shadowfax is the market leader in
this category. In addition, what makes Shadowfax unique is its crowdsourced model;
delivery partners have the ability to choose when/how long they work for and which
segments they want to work for.
Economics: Shadowfax mentioned its revenues have been growing at a CAGR of 116%
over the last five years; the company had a 21% gross margin in FY21, and is
contribution margin positive. Shadowfax is targeting revenues of US$900 mn in FY25,
with IPO plans over the next three years. Shadowfax is looking to ramp up investments
in micro warehouses and fulfillment centers in the near term.
Average deliveries on Shadowfax are at c.2 orders per hour in food, about 2.9 in grocery,
and about 3.8 in ecommerce.
Vedantu
Vedantu started in 2014 as a one-to-one live tutoring platform, and expanded into the
one-to-many format in 2017. The company is predominantly focused on the K-12
segment including test preparation, and is focused on the live AST (after-school tutoring)
segment. Vedantu has been growing 3x every year, with growth of 5-6x in 2020. The
company has a paid user base of 250k.
For our recent note on Byju’s, Vedantu’s key competitor, please see here: October 2020.
19 April 2021 19
The business: Vedantu has three broad verticals: (1) For 5-10 year olds: Co-curricular
programs - speaking, reading, coding, etc; (2) for classes 6 to 10: School programs -
equivalent of offline tutoring covering all major subjects and education boards; (3) for
classes 11-12: Tuition and test-prep (commerce, engineering, medical, etc.). Vedantu has
250 master teachers, with an average batch size of 350 students.
User base: Vedantu offers free live classes from where it converts students to paid
courses (short and long term). The company sees 30-32 mn users on its app/website
every month; students who took free live classes numbered 7.8 mn in 2020 (was 700k
in 2019), with current paid user base of 250k (was 45k in 2019).
Ticket size: Vedantu’s average ticket size is around US$250; the platform operates
across multiple price points: long-term courses (>10 months) are priced at US$500-600
for higher grades, and at around US$300-400 for lower grades. For single
module/chapters, prices also start at US$10. On a per hour basis, price points are
around Rs60 currently (used to be Rs100 in 2018), which per Vedantu, is 50% lower vs.
offline. Over the next 18 months, Vedantu aims to further lower price points to around
Rs30-35 per hour (Rs500 per month).
TAM: There are about 300 mn students in the K-12 segment in India, of which c.100 mn
go for AST. Vedantu’s target customers are those who have internet connectivity, along
with income levels >US$7k per year; this translates into 60-65 mn of student TAM.
Vedantu estimates this market to be US$15 bn in addressable value (US$250 ATP x
60-65 mn students), and expects it to rise to US$22-25 bn by FY25.
65% of Vedantu’s paid users (80% of free users) are from tier 2 cities and below, which
is where incremental growth is being driven by. Longer term, Vedantu believes there is
opportunity for the hybrid model (online + offline), especially in lower-tier towns and
cities.
Economics: Vedantu has gross margins of 65%-70%; 15%-20% of revenues are paid to
the teacher, while 10%-15% is operational cost. LTV to CAC (Lifetime Value to Customer
Acquisition Cost) for Vedantu is around 4x.
Teachers on the platform are typically on fixed contracts, with pay structure a mix of
fixed and variable component. Top teachers on Vedantu earn Rs15-20 mn per year.
Competition: Vedantu thinks education is not likely to be a winner-takes-all market in

India, and believes the company is well positioned in live tutoring and K-12. Per Vedantu,
it is the second largest platform in the online K-12 segment (the largest is Byju’s), and
largest in the live tutoring space.
Others:
n c.75% of Vedantu’s free users access content from mobile, while the same number
for paid users is around 55%-60%.
n Vedantu’s focus for the immediate future will remain on the Indian market, given the
low penetration of online education (3%-4% per Vedantu).
n Vedantu would be keen to IPO at some point, but did not comment on the timelines.
19 April 2021 20
Urban Company
Urban Company is a platform for home services, with the two main verticals being
beauty (salon, grooming, etc.) and home services (appliance repair, home repair, etc.).
Urban Company runs a fulfillment based model, fully controlling the service experience
for consumers. The platform facilitated US$230 mn in annualized net transactions as of
Mar ‘21 (service revenues), translating into US$64 mn commission revenue run rate.
Urban Company has a presence across 29 cities in India, and 4 cities internationally
(Sydney, Singapore and 2 cities in the UAE).
For our earlier notes on Urban Company, please see here: October 2019 and June 2019.
The business: Urban Company acts as a marketplace; the average take rate earned by
the platform is c.20%; the platform has 32k service professionals. The company has a
gross profit margin of 82% on net revenues, after accounting for costs such as payment
gateway and subscription discounts. Usually service professionals see a c.50% jump in
their net earnings after joining the Urban Company platform, with over time the number
rising to as high as 100%.
Salon for women makes up 28% of total topline (was 45%-50% pre-pandemic) while
men’s grooming contributes c.6%. Urban Company said that 95% of the traffic on its
platform is organic, with 94% of orders received from the app, and 80% orders from
repeat customers.
TAM: Historically, Urban Company has focused on the top 8-10 mn households in India
(in terms of income levels, with >US$30k of annual income), and the company has
mid-single digit penetration in this category. Urban Company is also looking to now
target the next 25-30 mn HHs (US$15-30k annual income) by offering services at
appropriate price points. Urban Company plans to continue to expand categories, and
aims to be present in over 100 cities in India over the next three years. The serviceable
addressable market in categories where Urban Company operates in is about US$20 bn,
of which just about 1.5% is online. Internationally, APAC will be the key focus areas for
expansion over the next few years for Urban Company.
Urban Company sees the following as its key growth drivers: (1) Quality; (2) pricing; (3)
selection; (4) go-to-market; and (5) product & tech.
Economics: Urban Company recovered to pre-COVID revenues by August ‘20, with

revenues being c.2x of pre-COVID levels in Mar ‘21. In CY21, Urban Company expects to
grow c.2.5x vs. CY20 revenues. Urban Company expects its India business to be
profitable by 4QCY21, with longer-term EBITDA margins of 30%-40%.
Others: Urban Company has raised US$140 mn of primary capital so far, of which
US$70 is in the bank. The company is targeting an IPO in 2022.
19 April 2021 21
Zerodha
The business: Zerodha is an online stock broking platform, which has a current client
base of 5 mn (was 180k in 2017); of these 5 mn accounts, active users are around 3.5
mn (users who have done a transaction in the last 12 months). Zerodha users have an
average age of around 26-27 years, and an average ticket size of Rs18-20k.
Economics: Zerodha had a revenue of Rs11 bn in FY20 (Rs3.6 bn in FY19) and Rs4.6 bn
in PAT (Rs1.8 bn in FY19); the company expects revenues to double in FY21. 70%-75%
of revenues on the platform comes from brokerage (Rs20 fee for intra-day and F&O
trades), 10%-15% from float money, and the remaining from other charges (account
opening fee, annual maintenance fee, etc.). Over time, the company would like to
reduce dependence on brokerage, and increase contribution from other new revenue
streams.
COVID-19 impact: Pre-COVID, on average, Zerodha was facilitating 4 mn trades a day,

which is currently at around 9 mn a day; 50% of these are cash delivery trades, 10% are
commodity derivative trades, and the remaining is split evenly between equity intra-day
and equity futures & options. Pre-COVID, Zerodha was opening about 70-75k accounts
per month, which increased to around 200k account per month after the onset of
COVID; in 2021 (for Jan to Mar), the number has risen to around 300k per month.
New initiatives: Zerodha got an NBFC license in FY19, and will go live with this product
(loan against shares and loan against mutual funds) over the next few months. The
company has also applied for an asset management license (expected in 2022); Zerodha
will look to keep expense ratios low and be a passive fund.
Others:
n Per Zerodha, unique mutual fund users in India are about 30-35 mn, and demat
account holders are around 20 mn.
n The company has historically observed a high correlation between new account
openings and index levels (Nifty Midcap Index); however, this has somewhat
changed since the start of COVID.
n Zerodha has Rs110 bn of mutual funds AUM on its platform.
Info Edge
For our recent notes on Info Edge, please see here: Feb 2021 (earnings review),
October 2020 (meeting takeaways).
State of the business: The company has been seeing gradual recovery since 2QFY21,
with the business starting to see growth from Dec ‘20; this has continued into the
ensuing months. Info Edge has thus far not seen a material impact on the business
from the second wave of COVID-19 (this meeting took place on 9 April).
19 April 2021 22
Real Estate: Over the last 4-5 years, the number of new home launches has been
slowing down, leading to declining marketing budgets. However, online portals have
grown double-digit percent during this period, indicating material increase in online
penetration. Earlier, agents were largely spending on offline mediums, but during the
pandemic, they have become increasingly reliant on online platforms for demand/lead
generation. Info Edge’s previous experience with the transaction model in real estate did
not yield satisfactory results given that the industry in India is largely organised; in the
near term, the company is likely to continue focusing on classifieds.
Per Info Edge, online real estate in India is still at a nascent stage, with classifieds
revenues largely concentrated in the top 10 cities. Thus, the runway for growth is long,
and there is room for multiple players/business models to coexist.
Matrimony: This business has been growing even during the peak of COVID, but ARPU
for all platforms has been coming down due to discounts; ARPUs are down about
30%-40% in the last few years, offset by volume growth. Info Edge will continue to
focus on this vertical, and is seeing increased traction in tier two and three cities. The
company has not seen any material change in competitive landscape from dating apps.
Capital allocation: Info Edge generates sufficient cash in its recruitment vertical to fund
internal operations including real estate and matrimony verticals. The company is
unlikely to make more than one large acquisition at a time, and mentioned that the
process of identifying M&A targets will only be gradual. Info Edge is also open to
acquiring strategic stakes in start-ups that have synergies with its existing businesses,
but is unlikely to foray into any new classifieds verticals in the near term.
AIF: The company has partnered with Temasek for the AIF (Alternative Investment
Fund). The investment strategy remains the same as that adopted in Info Edge’s earlier
investments, with focus on companies in segments such as consumer internet, B2B
SaaS, etc.; life of the fund is 14 years (12 + 2 years) with focus on early-stage
companies. Info Edge believes the AIF will bring more discipline to its investment
framework. Investment in existing portfolio companies will continue to happen from Info
Edge’s balance sheet; in addition, any investment in verticals adjacent to Info Edge’s
core classifieds (jobs, real estate, matrimony and education) will also take place from
the company’s balance sheet. Everything else will be done through the AIF.
MakeMyTrip
For our recent notes on MakeMyTrip, please see here: Jan 2021 (earnings review), Jan
2021 (better economics), October 2020 (meeting takeaways).
COVID-19 impact: MMYT was earlier expecting domestic demand to normalise by the
summer of 2021 (had reached c.50% in Jan ‘21), but given the recent surge in virus
cases, the recovery has likely gotten pushed back. However, consumer sentiment is not
as bad as it was last year during the first wave, per MMYT, given more data points
around the virus are now available, and there has been a pick up in vaccination. MMYT
expects a sharp rebound in travel when things normalise, with significant pent-up
19 April 2021 23
demand likely.
Supplier dynamics: MMYT does not expect take rates to be under pressure, as focus
of hotels in the near term is likely to be on demand generation; the company expects
hotel take rates to sustain around 17%-19%. Churn in suppliers (hotels) has been in the
range of 10%-15% due to COVID-19; per MMYT, of the total hotel supply in India, about
80% is independent properties (not associated with chains).
More alternative accommodation properties are being added on the MMYT platform,
with the number currently at around 20k. In the near term, MMYT is not likely to adopt
the model that Oyo has (of operating hotels). However, the company is open to
revisiting this idea in the future, if there happens to be a market opportunity.
Offline to online: Consumer behavior has accelerated towards online due to the
pandemic, and travel is not likely to be any different (although there could be a lag given
slower recovery of the category itself). This is true even for suppliers, who are now
more open to coming online; management gave the example of the state of
Maharashtra, where there has been a 30% increase in online bus inventory vs.
pre-COVID levels.
Competition: Per MMYT, some of its peers have gotten severely impacted due to the
pandemic. Global OTAs have seen disruption because inbound international traffic has
been impacted; this has helped MMYT drive higher market with high-end hotel chains in
India. Longer term, MMYT sees competition mainly from global OTAs such as
Booking.com, Expedia and Airbnb. Horizontal ecommerce platforms are mostly focused
on ticketing businesses, and MMYT does not foresee any irrational competition in the
industry. MMYT is positioning itself as a travel super app.
Use of capital: MMYT does not see any large consolidation opportunity in the India
travel space. The company will continue to make smaller investments such as that for its
foray into the GCC markets, and expansion of Redbus into the South East Asian
markets. In addition, there could be increased focus on verticals such as ground
transportation, alternative accommodation, activities & experiences, corporate segment,
etc.
Others: While MMYT has rationalised costs during the pandemic (fixed costs should
settle c.25% lower vs. pre-COVID), it is also building additional monetization
opportunities: for example, an advertisement platform that will have banner ads,
sponsored listings, etc.; in addition, MMYT is building a fintech platform called Trip
Money, that will offer consumer travel loans, insurance, forex, etc.
19 April 2021 24
Exhibit 12: Valuation methodology and target prices of stocks discussed in the note
Country/ Current Target Upside/ Mkt Cap Valuation
Ticker Rating Risks to our thesis
Region methodology
Price Price Downside (US$ mn)
Lower-than-expected refining/chemical margins,

lower-than-expected ARPU, lower than expected
Reliance Industries RELI.BO India Buy* Rs 1,934 2,405 24% 164,428 SOTP
market share and margins in retail business,
project delays and higher future capex
Faster than expected shift to online,

Info Edge INED.BO India Sell Rs 4,669 2,610.0 -44% 8,075 DCF consolidation in the classifieds space, upside to
Zomato from new initiatives, consolidation, etc.
DCF (42.5%);
EV/EBITDA (42.5%); Weaker-than-expected travel demand, higher
MakeMyTrip MMYT India Buy $ 26.4 37.0 40% 2,795
M&A - EV/EBITDA competition, and pressure on take rates
based (15%)
* denotes stock is on Conviction List. Prices as of April 16, 2021. Target prices are based on a 12-month period.
Source: Datastream, Goldman Sachs Global Investment Research

19 April 2021 25
Profiles of private internet companies

Exhibit 13: Profiles of a number of private internet companies in India
Internet companies in India with last round valuations >US$1 bn in the private market (Note: List not exhaustive)
Last round
Company Sector Details
valuation
India's largest ecommerce platform with 41% GMV market share in 2020 as per
US$24.9 bn
Flipkart Ecommerce Euromonitor. Also majority owner of PhonePe, one of India's largest digital
(2H2020)
payments platforms
US$500 mn of revenues in FY20. c.20 mn merchants. c.300 mn registered users,
Fintech & US$16 bn
Paytm 1.2 bn transactions a month. Also operates in verticals such as ecommerce and
payments (2H2019)
travel
Focus on AST. US$800 mn annualized revenues; 4.7 mn paid users, c.70 mn total US$15 bn
Byju's Edtech
users. Also recently launced synchronous learning (1H2021)
Online travel US$951 mn revenues in FY19 - 64% in India. Present across China, US, UK, US$10 bn
Oyo
(budget hotels) Indonesia, etc. 1 mn+ rooms under management (2H2019)
Present in 200+ cities across India; also present in Australia, New Zealand and
US$6.5 bn
Ola Mobility UK. 2.5-3 mn rides per day (pre-COVID). Additionally, has businesses such as
(2H2019)
cloud kithchens and fintech
Food delivery and US$394 mn FY20 revenues, with US$1.5 bn in food delivery GMV. 500+ cities in US$5.4 bn
Zomato
discovery India, with 200k+ riders (1H2021)
Food delivery & c.40mn orders per month (pre-COVID). c.500 cities, c.200k riders. Also launched US$5 bn
Swiggy
hyper-local online grocery and has a cloud kitchen business (1H2021)
Online gaming US$3.6 bn

Dream11 80mn+ users as of 2020; US$100 mn+ revenues in year ended March 19
(fantasy sports) (1H2021)
GMV of US$2.3 bn as of Mar ‘21, across food & grocery, pharma, electronics,
Ecommerce US$3.1 bn
Udaan lifestyle, etc. User base of c.1.5 mn SMEs. 70% market share in B2B ecommerce
(B2B) (1H2021)
in India, per company
US$130 mn revenues in FY19; <5% market share in ecomerce in 2020, per US$2.9 bn
Paytm Mall Ecommerce
Eurimonitor (2H2019)
Fintech 1 mn policies sold on the platform, with US$100 mn of annual revenues (US$700
US$2.4 bn
Policybazaar (Insurance & mn of premiums). Also has a lending business called PaisaBazaar with US$30-40
(1H2021)
credit) mn of revenues
Ecommerce Network of 100k suppliers and 14 mn re-sellers, with cumulative end-customers of
US$2.1 bn
Meesho (Social 33 mn. Annualised GMV of US$1.5 bn as of Mar '21, processing c.20 mn order in
(1H2021)
commerce) the month
US$2 bn
Unacademy Edtech 350k paid subsribers with 30 mn registered users. Focused on post K-12 segment
(2H2020)
17.5k+ pin codes across 2300+ cities. 300k sellers; 1 mn shipments per day. 85+ US$2.0 bn
Delhivery Logistics
fulfilment centers (2H2020)
Ecommerce US$1.9 bn
BigBasket US$1 bn of annualized GMV as of May 2020; 350k orders per day
(grocery) (1H2021)
Ecommerce Annualized revenue of US$300 mn (Sept 2020), with GMV of US$500 mn.30%
US$1.8 bn
Nykaa (Beauty & revenue market share of the online beauty market, per Nykaa. 13% of total sales
(2H2020)
fashion) come from fashion
GMV run-rate of Rs8.25 bn (US$110 mn) a month, of which Rs6 bn is from the
PharmEasy US$1.5 bn
Health tech B2B arm, and Rs2.25 bn from B2C. Connected to 80k retailers (10% of all
(API Holdings) (1H2021)
pharmacies in India), and 3k distributors and manufacturers
Local language 285 mn Monthly Active Users. About US$220 mn in revenues (as of 2020), with US$1 bn
Dailyhunt
content and news target of US$2 bn in five years. Also operates a short form video app (2H2020)
Online stock broking platform, which has a client base of 5 mn in 2021. Revenues US$1 bn
Zerodha Fintech (broking)
of Rs11 bn in FY20, with PAT of Rs4.6 bn (1H2020)
We do not cover any of the private companies listed under ‘Company’ above. ‘Last round valuation’ (implied valuations from the latest funding round) data from press reports. ‘Details’ either from the
company or press reports and data is for 2020 or latest available run rate numbers.
Source: Company data, Press reports (Economic Times, Livemint, Business Standard, Entrackr, Inc42), Data compiled by Goldman Sachs Global Investment Research
19 April 2021 26
Global internet valuations

Exhibit 14: Global internet valuation sheet
Country/ Current Target Upside/ Mkt Cap EV EV/EBITDA (X) P/E (X) EV/Sales (X) EBITDA margin CY2020-23E CAGR
Global internet Ticker Rating
Region Price Price Downside (US$ mn) (US$ mn) 2021E 2022E 2021E 2022E 2021E 2022E 2021E 2022E Sales EBITDA PAT
Info Edge INED.BO India Sell Rs 4,669 2,610.0 -44% 8,075 7,608 108.1 80.1 108.3 82.2 34.6 28.7 32% 36% 19% 32% 33%
Domain DHG.AX Australia Neutral A$ 4.8 4.75 -1% 2,147 2,273 29.8 25.7 88.1 67.8 10.1 9.3 34% 36% 5% 8% 13%
REA Group REA.AX Australia Buy A$ 159.1 159.00 0% 16,213 16,116 33.9 28.7 62.0 51.6 22.1 19.2 60% 62% 9% 11% 13%
Classifieds
SEEK SEK.AX Australia Neutral A$ 30.8 27.40 -11% 8,203 9,358 23.6 21.1 73.6 59.1 7.0 6.3 30% 30% 7% 10% 10%
Scout24 G24n.DE Europe Buy ¼ 69.1 75.9 10% 8,455 8,015 24.7 21.0 44.2 37.6 17.7 15.8 60% 62% 10% 12% 11%
Auto Trader AUTOA.L Europe Buy £ 577.6 677.0 17% 7,726 7,967 24.0 19.9 30.0 24.8 16.6 14.4 67% 69% 15% 18% 17%
Rightmove RMV.L Europe Buy £ 610.4 693.0 14% 7,370 7,319 22.7 20.2 28.9 25.6 17.6 16.1 75% 76% 20% 24% 22%
Headhunter Group HHR Russia Buy $ 38.1 43.2 13% 1,917 1,952 24.8 18.9 38.0 27.9 12.4 10.2 51% 54% 28% 32% 38%
Schibsted SBSTA.OL Europe Not Rated Nkr 424.7 12,017 13,077 21.6 18.1 51.6 40.8 5.0 4.5 22% 24% 10% 18% 20%
Median 24.7 21.0 51.6 40.8 16.6 14.4 51% 54% 10% 18% 17%
MakeMyTrip MMYT India Buy $ 26.4 37.0 40% 2,795 2,628 NM 21.6 NM 48.6 5.0 3.1 6% 13% 50% NM NM
Travel
Ctrip/Trip.com TCOM China Neutral $ 36.5 43.00 18% 23,491 28,747 55.8 20.5 63.6 18.2 7.4 4.8 13% 22% 35% 107% NM
Tongcheng-Elong 0780.HK China Buy HK$ 18.8 21.2 13% 5,117 4,838 16.9 10.5 22.3 12.9 3.6 2.6 22% 26% 34% 39% 50%
Median 36.3 20.5 42.9 18.2 5.0 3.1 13% 22% 35% 73% 50%
Meituan Dianping 3690.HK China Buy HK$ 290.2 396.0 36% 224,229 212,517 NM 39.1 NM 60.5 7.3 4.9 1% 12% 49% 133% 145%
Food
Just Eat Takeaway TKWY.AS Europe Not Rated ¼ 91.0 16,209 15,813 NM NM NM NM 3.8 3.0 -1% 2% 29% 18% 48%
Median NM 39.1 NM 60.5 5.5 4.0 0% 7% 39% 75% 96%
MercadoLibre MELI Latam Buy $ 1,591.9 2,370.0 49% 79,308 77,171 NM NM NM NM 13.3 9.1 4% 6% 45% 65% NM
Allegro.eu ALEP.WA Poland Buy PLN 57.2 85.0 49% 15,410 16,366 30.4 23.9 50.8 39.3 12.1 9.5 40% 39% 28% 22% 29%
Ozon Holdings OZON Russia Buy $ 62.8 70.0 12% 13,105 11,751 NM NM NM NM 5.3 3.3 -8% -2% 59% NM NM
Ecommerce
Coupang CPNG S Korea Buy $ 45.9 62.0 35% 82,139 80,032 NM NM NM NM 3.8 2.7 -2% -1% 51% NM NM
VIPShop VIPS China Neutral $ 28.4 21.5 -24% 19,774 17,097 11.3 9.6 16.8 15.5 0.9 0.9 8% 9% 11% 18% 19%
Alibaba BABA China Buy* $ 238.7 350.0 47% 654,190 621,866 15.8 11.7 20.0 16.1 4.5 3.6 28% 29% 33% 30% 29%
JD.com JD China Buy* $ 77.0 119.0 54% 122,923 102,104 26.4 17.6 41.5 28.4 0.7 0.6 3% 3% 22% 26% 30%
Pinduoduo PDD China Buy $ 133.3 183.0 37% 191,636 165,874 NM 59.3 NM 77.0 13.0 9.7 4% 13% 55% NM NM
Dada Nexus DADA China Buy $ 24.7 46.0 86% 5,610 5,162 NM 53.9 NM 86.3 4.9 3.1 -24% 6% 43% NM NM
Median 21.1 20.8 30.7 33.8 4.9 3.3 4% 6% 43% 26% 29%
*denotes stock is on Conviction List. Metrics are for calendar years. Prices as of April 16, 2021. CAGRs for CY19-22, where CY20-23 unavailable. Target prices are based on a 12-month period.
Source: Datastream, Company data, Goldman Sachs Global Investment Research
19 April 2021 <7

Exhibit 15: Global internet valuation sheet (continued)
Country/ Current Target Upside/ Mkt Cap EV EV/EBITDA (X) P/E (X) EV/Sales (X) EBITDA margin 2020-23E CAGR
Global internet Ticker Rating
Region Price Price Downside (US$ mn) (US$ mn) 2021E 2022E 2021E 2022E 2021E 2022E 2021E 2022E Sales EBITDA PAT
Zynga ZNGA US Buy $ 10.6 12.80 21% 11,404 10,645 15.7 13.3 NM NM 3.7 3.4 26% 27% 14% 15% NM
Activision ATVI US Buy* $ 96.5 116.00 20% 75,254 67,831 16.9 14.5 25.2 22.4 7.5 6.7 44% 44% 3% 9% 5%
Take Two TTWO US Buy $ 178.8 221.0 24% 20,762 18,635 19.6 17.6 27.2 26.3 4.8 4.3 24% 23% 16% 8% 7%
Electronic Arts EA US Buy $ 141.1 174.0 23% 41,187 36,684 14.9 14.0 22.7 21.5 5.6 5.4 36% 36% 6% 7% 3%
Ubisoft UBIP.PA Europe Neutral ¼ 65.0 77.0 19% 9,779 10,218 14.6 13.4 25.0 21.5 3.6 3.2 23% 21% 7% 13% 14%
Gaming
NCSOFT 036570.KS Korea Buy W 912,000 1,190,000 30% 17,935 17,062 17.1 10.2 24.6 15.3 6.5 4.9 36% 43% 17% 23% 28%
Netmarble 251270.KS Korea Sell W 146,000 64,000 -56% 11,225 11,915 37.0 31.9 51.5 42.8 5.1 4.7 13% 14% 2% -7% -10%
Pearl Abyss 263750.KQ Korea Buy W 67,000 98,000 46% 3,958 3,774 17.9 6.5 27.4 10.4 7.8 4.5 40% 56% 26% 43% 57%
Tencent 0700.HK China Buy HK$ 632.0 920.0 46% 785,003 778,578 23.0 16.7 32.4 23.8 8.4 6.9 36% 40% 23% 30% 30%
NetEase NTES China Buy $ 106.8 132.0 24% 72,283 59,891 17.9 13.3 24.7 20.2 4.5 3.8 24% 28% 18% 20% 25%
Sea Ltd SE ASEAN Buy* $ 252.4 330.0 31% 151,295 147,263 NM 32.2 NM 40.3 13.6 7.8 14% 30% 63% 300% NM
Median 17.5 14.0 25.2 22.0 5.6 4.7 26% 30% 16% 15% 14%
Entertainment
iQIYI IQ China Neutral $ 15.2 20.80 37% 11,377 13,065 6.0 4.8 NM NM 2.6 2.4 44% 51% 11% 16% NM
Tencent Music TME China Neutral $ 18.0 28.40 57% 30,324 27,993 24.3 15.3 30.1 19.8 5.0 3.8 21% 23% 28% 40% 40%
Huya HUYA China Not Rated $ 18.2 4,289 2,650 9.7 6.3 16.4 12.5 1.2 1.1 12% 14% 23% 57% 45%
Bilibili BILI China Buy $ 103.5 157.00 52% 39,445 37,462 NM NM NM NM 12.6 8.7 -6% 6% 47% NM NM
Median 9.7 6.3 23.3 16.2 3.8 3.1 16% 19% 25% 40% 43%
Mail.ru MAILRq.L Russia Neutral $ 23.0 27.80 21% 5,034 4,961 11.4 8.9 42.7 26.1 2.9 2.5 26% 27% 21% 11% 0%
Advertising
Baidu BIDU China Buy $ 213.6 385.00 80% 73,013 51,834 11.8 8.4 22.6 17.4 2.7 2.3 23% 26% 16% 19% 17%
Weibo WB China Neutral $ 49.5 41.00 -17% 11,605 9,026 12.5 10.7 18.4 15.5 4.6 4.2 37% 40% 7% 8% 6%
Sogou SOGO China Not Rated $ 8.5 3,244 2,082 10.9 8.4 23.6 19.6 1.6 1.5 15% 16% 7% 17% 18%
Median 11.6 8.6 23.1 18.5 2.8 2.4 24% 27% 11% 14% 11%
New Oriental EDU China Buy* $ 15.0 18.60 24% 24,306 18,846 26.0 15.3 40.3 27.9 3.8 2.9 15% 18% 28% 47% 37%
TAL TAL China Neutral $ 59.4 72.00 21% 37,275 31,514 NM 27.6 80.9 39.4 5.2 3.8 7% 13% 37% NM 194%
GSX Techedu GSX China Sell $ 25.5 70.00 175% 6,185 5,133 NM NM NM NM 2.8 1.8 -10% -1% 52% NM NM
Education & others
OneConnect OCFT China Neutral $ 15.8 24.50 56% 5,806 6,031 NM NM NM NM 7.9 5.6 -16% 1% 41% NM NM
Lufax LU China Buy $ 13.8 20.30 47% 31,866 30,428 7.4 6.1 14.2 12.4 3.3 2.9 48% 50% 14% 18% 20%
KE Holdings BEKE China Buy $ 51.5 75.00 46% 61,016 50,978 33.1 21.6 51.2 34.7 3.5 2.9 11% 13% 26% 37% 37%
JD Health 6618.HK China Neutral HK$ 107.0 139.00 30% 43,852 40,317 NM NM NM NM 10.7 6.5 1% 1% 55% -22% 5%
ANGI Homeservice ANGI US Buy $ 16.8 18.10 8% 8,513 8,358 50.1 28.0 NM NM 4.9 4.0 10% 14% 20% 34% NM
Match Group MTCH US Neutral $ 145.3 150.00 3% 41,411 43,683 39.8 32.3 71.8 56.7 15.5 13.6 38% 40% 15% 18% 22%
Yandex YNDX Russia Buy $ 61.9 85.50 38% 20,824 22,152 32.4 19.5 62.0 33.8 5.2 4.1 16% 21% 31% 36% 44%
Median 32.7 21.6 56.6 34.2 5.0 3.9 10% 14% 29% 34% 37%
*denotes stock is on Conviction List. Metrics are for calendar years. Prices as of April 16, 2021. CAGRs for CY19-22E where CY20-23 unavailable. Target prices are based on a 12-month period.
Source: Datastream, Company data, Goldman Sachs Global Investment Research
19 April 2021 <8

Disclosure Appendix
Reg AC
I, Manish Adukia, CFA, hereby certify that all of the views expressed in this report accurately reflect my personal views about the subject company or
companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific
recommendations or views expressed in this report.
Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Goldman Sachs’ Global Investment Research division.
GS Factor Profile
The Goldman Sachs Factor Profile provides investment context for a stock by comparing key attributes to the market (i.e. our coverage universe) and its
sector peers. The four key attributes depicted are: Growth, Financial Returns, Multiple (e.g. valuation) and Integrated (a composite of Growth, Financial
Returns and Multiple). Growth, Financial Returns and Multiple are calculated by using normalized ranks for specific metrics for each stock. The
normalized ranks for the metrics are then averaged and converted into percentiles for the relevant attribute. The precise calculation of each metric may
vary depending on the fiscal year, industry and region, but the standard approach is as follows:
Growth is based on a stock’s forward-looking sales growth, EBITDA growth and EPS growth (for financial stocks, only EPS and sales growth), with a
higher percentile indicating a higher growth company. Financial Returns is based on a stock’s forward-looking ROE, ROCE and CROCI (for financial
stocks, only ROE), with a higher percentile indicating a company with higher financial returns. Multiple is based on a stock’s forward-looking P/E, P/B,
price/dividend (P/D), EV/EBITDA, EV/FCF and EV/Debt Adjusted Cash Flow (DACF) (for financial stocks, only P/E, P/B and P/D), with a higher percentile
indicating a stock trading at a higher multiple. The Integrated percentile is calculated as the average of the Growth percentile, Financial Returns
percentile and (100% - Multiple percentile).
Financial Returns and Multiple use the Goldman Sachs analyst forecasts at the fiscal year-end at least three quarters in the future. Growth uses inputs
for the fiscal year at least seven quarters in the future compared with the year at least three quarters in the future (on a per-share basis for all metrics).
For a more detailed description of how we calculate the GS Factor Profile, please contact your GS representative.
M&A Rank
Across our global coverage, we examine stocks using an M&A framework, considering both qualitative factors and quantitative factors (which may vary
across sectors and regions) to incorporate the potential that certain companies could be acquired. We then assign a M&A rank as a means of scoring
companies under our rated coverage from 1 to 3, with 1 representing high (30%-50%) probability of the company becoming an acquisition target, 2
representing medium (15%-30%) probability and 3 representing low (0%-15%) probability. For companies ranked 1 or 2, in line with our standard
departmental guidelines we incorporate an M&A component into our target price. M&A rank of 3 is considered immaterial and therefore does not
factor into our price target, and may or may not be discussed in research.
Quantum
Quantum is Goldman Sachs’ proprietary database providing access to detailed financial statement histories, forecasts and ratios. It can be used for
in-depth analysis of a single company, or to make comparisons between companies in different sectors and markets.
Disclosures
Financial advisory disclosure
Goldman Sachs and/or one of its affiliates is acting as a financial advisor in connection with an announced strategic matter involving the following
company or one of its affiliates: Reliance Industries Limited
The rating(s) for Reliance Industries and Reliance Industries (GDR) is/are relative to the other companies in
its/their coverage universe:
Bangchak Corp PCL, Bharat Petroleum, GS Holdings, Hindustan Petroleum, Indian Oil Corp., Reliance Industries, Reliance Industries (GDR), S-Oil Corp.,
SK Innovation, Thai Oil
The rating(s) for Info Edge India Ltd. and MakeMyTrip Ltd. is/are relative to the other companies in its/their
coverage universe:
Bharti Airtel, Indus Towers Ltd., Info Edge India Ltd., MakeMyTrip Ltd., PVR Ltd., Vodafone Idea Ltd., Zee Entertainment Enterprises
Company-specific regulatory disclosures

The following disclosures relate to relationships between The Goldman Sachs Group, Inc. (with its affiliates, “Goldman Sachs”) and companies covered
by the Global Investment Research Division of Goldman Sachs and referred to in this research.
Goldman Sachs beneficially owned 1% or more of common equity (excluding positions managed by affiliates and business units not required to be
aggregated under US securities law) as of the month end preceding this report: MakeMyTrip Ltd. ($26.35)
Goldman Sachs has received compensation for investment banking services in the past 12 months: Info Edge India Ltd. (Rs4,697.25), MakeMyTrip Ltd.
($26.35), Reliance Industries (Rs1,902.55) and Reliance Industries (GDR) ($51.90)
Goldman Sachs expects to receive or intends to seek compensation for investment banking services in the next 3 months: Info Edge India Ltd.
(Rs4,697.25), MakeMyTrip Ltd. ($26.35), Reliance Industries (Rs1,902.55) and Reliance Industries (GDR) ($51.90)
Goldman Sachs had an investment banking services client relationship during the past 12 months with: Info Edge India Ltd. (Rs4,697.25), MakeMyTrip
Ltd. ($26.35), Reliance Industries (Rs1,902.55) and Reliance Industries (GDR) ($51.90)
Goldman Sachs had a non-securities services client relationship during the past 12 months with: Reliance Industries (Rs1,902.55) and Reliance
Industries (GDR) ($51.90)
Goldman Sachs has managed or co-managed a public or Rule 144A offering in the past 12 months: Info Edge India Ltd. (Rs4,697.25)
19 April 2021 29
Goldman Sachs makes a market in the securities or derivatives thereof: MakeMyTrip Ltd. ($26.35)
Distribution of ratings/investment banking relationships

Goldman Sachs Investment Research global Equity coverage universe
Rating Distribution Investment Banking Relationships

Buy Hold Sell Buy Hold Sell
Global 52% 35% 13% 65% 58% 50%
As of April 1, 2021, Goldman Sachs Global Investment Research had investment ratings on 3,027 equity securities. Goldman Sachs assigns stocks as
Buys and Sells on various regional Investment Lists; stocks not so assigned are deemed Neutral. Such assignments equate to Buy, Hold and Sell for
the purposes of the above disclosure required by the FINRA Rules. See ‘Ratings, Coverage universe and related definitions’ below. The Investment
Banking Relationships chart reflects the percentage of subject companies within each rating category for whom Goldman Sachs has provided
investment banking services within the previous twelve months.
Price target and rating history chart(s)

Regulatory disclosures ad6a3f57ebc54e4ebcb697ec551e5ba0

Disclosures required by United States laws and regulations
See company-specific regulatory disclosures above for any of the following disclosures required as to companies referred to in this report: manager or
co-manager in a pending transaction; 1% or other ownership; compensation for certain services; types of client relationships; managed/co-managed
public offerings in prior periods; directorships; for equity securities, market making and/or specialist role. Goldman Sachs trades or may trade as a
principal in debt securities (or in related derivatives) of issuers discussed in this report.
The following are additional required disclosures: Ownership and material conflicts of interest: Goldman Sachs policy prohibits its analysts,
professionals reporting to analysts and members of their households from owning securities of any company in the analyst’s area of coverage.
Analyst compensation: Analysts are paid in part based on the profitability of Goldman Sachs, which includes investment banking revenues. Analyst
as officer or director: Goldman Sachs policy generally prohibits its analysts, persons reporting to analysts or members of their households from
serving as an officer, director or advisor of any company in the analyst’s area of coverage. Non-U.S. Analysts: Non-U.S. analysts may not be
associated persons of Goldman Sachs & Co. LLC and therefore may not be subject to FINRA Rule 2241 or FINRA Rule 2242 restrictions on
communications with subject company, public appearances and trading securities held by the analysts.
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19 April 2021 30
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India Internet - IIC '21 Takeaways - Faster, Higher, Stronger

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India Internet - IIC '21 Takeaways - Faster, Higher, Stronger

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19 April 2021 | 7:40PM IST

IIC ‘21 takeaways: Faster, higher, stronger

to improve unit economics, we remain skeptical regarding sustainability of these

Growth: On track for 3x scale over next four years

A pulse check of the ecosystem 4

Ecommerce: Strong growth to sustain in FY22 8

Read-across for covered stocks 10

Proﬁles of private internet companies 26

Closer to proﬁtability, but steady-state margins some time away

Capital activity elevated; companies increasingly talking about IPOs

Positive read-across for covered stocks

India Internet: A US$185 bn opportunity

Food & Gaming & Advertise- Fintech/ India

FY20 $2.3 $2.3 $61

FY25E $119 $185

Take rate* 11% 8% 25% 25% NA NA NA NA

FY25E $2.3 $4.3 $6.3 $2.5 $69

Profit* margin 8% 12% 14% 18% 23% 22% 20% 12%

FY25E $3.8 $0.3 $0.6 $1.1 $1.2 $1.1 $0.5 $8.6

Valuation $113 $257

Amazon, MMYT, Swiggy, TIL, Byju's, Paytm,

A pulse check of the ecosystem

The biggest beneﬁciaries of this uplift in growth continue to be sectors such as

translating into a 31% FY21-25E CAGR (25% FY20-25E).

Average scale c.2x vs pre-COVID

Source: Company data, Goldman Sachs Global Investment Research

The list of apps used is not exhaustive.

Source: SensorTower, Data compiled by Goldman Sachs Global Investment Research

ecommerce: Growth momentum to sustain

We expect ecommerce (including grocery) to be the biggest battleground for India

Food delivery: Outlook robust, but growth lagging global peers

EBITDA pool of c.US$500 mn by FY25E (assuming 28% take rate).

Exhibit 4: Growth in food delivery in India has signiﬁcantly

Source: Company data, Goldman Sachs Global Investment Research

Education: A structural beneﬁciary

Ecommerce: Strong growth to sustain in FY22

Despite a month of complete lockdown for non-essential deliveries, ecommerce in

Overall, we expect ecommerce to reach US$119 bn by FY25E, almost 3x vs. FY21

33% 32% 1.3%

21 27 33 44 58 74 94 119 3.8% 4.5% 5.3% 6.9% 8.2% 9.5% 11.1% 12.9%

14% 14% 40%

$15 bn 1,200 Grofers 1,200

$33 bn 900 Jiomart 900

$44 bn 600 600

FY21 indicates year ended March 2021. INR USD of 75.

Source: SensorTower, Data compiled by Goldman Sachs Global Investment Research

Read-across for covered stocks

MakeMyTrip: Near term uncertain, but beneﬁciary of share gains; Buy

In the following sections, we detail company-speciﬁc takeaways from the thirteen

Unless otherwise stated, the company-speciﬁc sections are all management

Flipkart’s entire grocery/hyper-local delivery is being managed by Shadowfax, which

for customers including reverse logistics.

The landscape: Shadowfax operates in the following four categories.

Competition: Vedantu thinks education is not likely to be a winner-takes-all market in

Economics: Urban Company recovered to pre-COVID revenues by August ‘20, with

COVID-19 impact: Pre-COVID, on average, Zerodha was facilitating 4 mn trades a day,

Lower-than-expected refining/chemical margins,

Faster than expected shift to online,

Source: Datastream, Goldman Sachs Global Investment Research

Proﬁles of private internet companies

Online gaming US$3.6 bn

Global internet valuations

Source: Datastream, Company data, Goldman Sachs Global Investment Research