Urban Company: 1Q27: Strong core business momentum, but InstaHelp losses widen qoq

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Urban Company

1Q27: Strong core business momentum,

but InstaHelp losses widen qoq

Reiterate Rating: NEUTRAL | PO: 155.00 INR | Price: 129.39 INR

Strong revenue & EBITDA beat for ex InstaHelp business

31 July 2026

Urban Co (UC) NTV and revenues each were 5% ahead of BofAe, led by strong 29% YoY

growth in India consumer services NTV (ex-InstaHelp). Orders in InstaHelp scaled up by

43% sequentially (albeit slightly slower vs 4Q’s 66% QoQ growth). Segmental loss came

in slightly higher vs BofAe at Rs 1.32bn vs 4Q’s Rs 1.19bn. Group Adj. EBITDA losses

narrowed QoQ to Rs 650mn (slightly better than BofAe). InstaHelp’s adj. EBITDA loss per

order was better QoQ at Rs 345 loss. Unit economics in this segment improved despite

rapid scale-up and management is prioritizing market leadership over everything else.

Post 1Q, we slightly revise our FY27/28E EPS estimates. Our multiples & PO remain

unchanged. Reiterate Neutral rating given balanced risk reward.

Equity

InstaHelp: Low single digit steady-state margin category

Mgmt believes that it is more important over next quarters to be aggressive with focus

of winning disproportionate share of TAM along with more profitable segments. UC’s

key focus is to be a leader in this market and not focus on profitability over next 5 years.

In all likelihood, steady state margins in the category could be in low single digits, per

mgmt. AOV would need to get to around Rs 300 for this business to break-even per

mgmt. On sustainable basis, service professional has to be paid c. Rs 150 per hour,

utilizing 6 hours’ time (at c.65% utilization). Net earnings would be around Rs 20-22K for

this category to be attractive and see supply side converting from offline. Gross margin

breakeven would likely occur at Rs 150 per hour. With an incremental Rs 50 likely needed

to cover all other costs including customer support, marketing, teams, training costs etc.

Hence the pricing would have to be at least Rs 200 per hour to achieve break-even.

From a 2-year perspective, mgmt sees India consumer business to remain profitable and

generate cash. Mgmt would like to be disciplined and maximize growth while ensuring

steady margin improvement.…