Just Dial Shares Skyrocket 15% After Q1 Profit Surges 69%; Check Target Price

Shares of Just Dial hit a 9-year high at Rs 1,189.95, zooming 15 per cent on heavy volumes after the company reported a strong 69 per cent year-on-year (YoY) jump in its net profit at Rs 141.2 crore for the first quarter of fiscal 2025 (Q1FY25). India’s leading local search engine company had posted net profit of Rs 83.4 crore in the same quarter last fiscal.

Net profit zoomed to Rs 141.2 crore in Q1 against a net profit of Rs 83.4 crore in the June 2023 quarter. Revenue from operations rose 13.6% to Rs 280.5 crore against Rs 247 crore in the corresponding period of the preceding fiscal.

Operating profit rose to Rs 80.5 crore in Q1 against Rs 36.6 crore in the corresponding period in the previous fiscal. EBITDA margins climbed to 28.7% in Q1 compared to 14.8% in the corresponding period in the previous fiscal. EBITDA is earnings before interest, tax, depreciation, and amortisation.

Just Dial reported a total traffic (unique visitors) of 181.3 million, a 5.7% year-on-year and 6.0% quarter-on-quarter rise. Mobile platforms accounted for 85.3% of the traffic, while 11.3% came from desktop or personal computers and 3.4% from the Voice platform.

According to ICICI Securities, Just Dial reported strong numbers in the quarter with a growth of 13.6 per cent in revenues on the back of higher paid campaigns (+8k campaigns during the quarter) along with an increase in the price per paid campaign.

The margins improved significantly during the quarter due to operating leverage coupled with cost control. The cash balance now stands at ~55 per cent of the market capitalisation of the company; it is yet to decide on the utilisation/distribution of its cash balance. We maintain a positive view on the company, the brokerage firm said in a note.

Meanwhile, the management mentioned that the board is considering various avenues such as dividend, buyback or any other means to ensure tax efficient distribution of 100 per cent (or higher) of the company’s annual profits or incremental cash generated to shareholders. At CMP, the yield on payouts could be more than 6 per cent assuming full distribution of FY25 PAT or FCFF plus other income, said analysts at JM Financial Institutional Securities.

While collections growth was muted at 5.4 per cent YoY, the management attributed it to general elections in April-May and indicated a sharp recovery in trends in June. “We conservatively build revenue growth of 13.5 per cent over the medium term vs. the management target of above mid-teens. We reiterate that EBITDA growth in FY25 could be very robust at c.60 per cent YoY, as full impact of the recent margin expansion is yet to come in the base,” the brokerage firm said with ‘Buy’ rating on the stock and target price of Rs 1,300 per share.

Disclaimer:Disclaimer: The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.