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Internet Sector Q4 Results Preview - Strong B2B; B2C May Be Underwhelming: ICICI Securities

In our view, B2B e-commerce is likely to continue on a strong growth trajectory in Q4 FY23E.

<div class="paragraphs"><p>A person browsing internet. (Source: pexels)</p></div>
A person browsing internet. (Source: pexels)

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ICICI Securities Report

Q3 FY23 was a difficult quarter for most business-to-consumer e-commerce companies and investors were expecting recovery in Q4 FY23E. However, our channel checks indicate B2C growth may underwhelm expectations.

We note signs of consumption fatigue across online food ordering and beauty and personal care e-commerce. This is in contrast to the buoyancy in some offline discretionary categories such as travel and hospitality.

We believe this is due to-

  1. wallet share recalibration among different consumption baskets and

  2. sustained trend of online-to-offline migration first seen in Q2 FY23.

In our view, business-to-business e-commerce is likely to continue on a strong growth trajectory in Q4 FY23E led by penetration increase as small businesses explore means of increasing their digital footprint both on supply and demand sides.

Click on the attachment to read the full report:

ICICI Securities Internet Q4FY23 Preview.pdf
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