Urban Company Jumps 18% As Morgan Stanley Bets On Core Business Growth

Shares of Urban Company experienced a significant 18% rise following Morgan Stanley's upgrade to "Overweight" status. The brokerage firm's decision was based on the company's improving growth in its India consumer services business and international operations, despite ongoing investments in InstaHelp. The stock rebounded to trade 13% higher at ₹146.70 per share at 10:26 IST, with its market capitalization reaching ₹22,623.7 Cr.

Morgan Stanley increased its target price to ₹165 from ₹128, attributing the positive outlook to the company's core operations and international growth. The company reported a Q1 FY27 loss of ₹92.1 Cr, primarily due to investments in InstaHelp, which saw a 43% rise in orders and a ₹132 Cr adjusted EBITDA loss. CEO Abhiraj Singh Bhal highlighted InstaHelp's strategic importance in boosting customer engagement, but acknowledged its lower-margin nature and projected profitability beyond five years.

Core services outside InstaHelp continued to strengthen, with NTV growing 29% YoY to ₹1,056 Cr and an improved adjusted EBITDA margin of 6.9%. Meanwhile, the company's international operations posted a 76% YoY NTV growth, with profitable developments in the UAE, Singapore, and Saudi Arabia.