Apple's India map provider surges 104% in over 6 months as it rivals Google’s product

An Indian navigation company’s stock, which was favored by Mark Mobius, has doubled in about six months as its mapping service grows more popular in the country, pitting it against Alphabet Inc.’s Google Maps. Market watchers are now split on whether the rally will continue.

Shares of Map my India, formally known as CE Info Systems Ltd., have risen about 104% from the end of March, adding around $675 million in market value on demand for its consumer-facing app Mappls. Some analysts and investors are betting on the company’s domestic growth opportunity, while others view its price tag as a barrier.

“The valuations look really stretched now,” said Piyush Pandey, technology analyst at Yes Securities India Ltd. “I expect the stock to go into a consolidation phase.”

Map my India was founded by the husband-and-wife duo Rakesh and Rashmi Verma, who decided to create digital maps of India long before Google revolutionized web cartography. The Vermas traversed India’s mega-cities by foot, painstakingly charting streets and landmarks. Their son Rohan Verma, a graduate in electrical engineering from Stanford, is now the firm’s chief executive officer.

The majority of its revenue comes from providing mapping services to other businesses such as Apple Inc., BMW AG and Amazon.com Inc.

Mobius flagged the stock as one of his top picks in India in a June interview to Bloomberg, saying the company will “benefit from digitization of the country.” His firm Mobius Capital Partners LLP owns a 0.74% stake in the company, according to data compiled by Bloomberg. It initially invested in January and boosted its holding over the following four months.

After their surge, the shares trade about 65 times its estimated earnings over the next 12 months compared to around 21 times for the S&P BSE 500 Index, according to Bloomberg-compiled data. The stock has pulled back 8.5% from an Oct. 6 record high.

Still, Shobit Singhal, lead internet stocks analyst at Anand Rathi Institutional Broking Ltd., remains optimistic. He expects the company to grow its sales by 35%-40% every year for at least the next 3-5 years.

“The business has no listed peers in such a big domestic market,” he said. “Such growth combined with a management with strong pedigree deserves a premium valuation,” he said.

The company is investing in in-house drone technologies and is also looking to acquire drone businesses, CEO Rohan Verma said in a phone interview. MapmyIndia is also expanding internationally on demand from their clients, most of which are multinationals.

“We want to be a full-stack drones provider,” he said. “We have the technological know-how of navigation, now its time to widen its use cases.”