SAIF Partners sells 2.4 per cent stake in Just Dial

MUMBAI: SAIF Partners, one of the early investors in local search provider Justdial, has sold 2.41% stake in the Mumbai-based company, earning returns of over 30 times its investment cost. The shares have been sold in tranches since June and amount to total of Rs 254 crore, Bombay Stock Exchange ( BSE) data shows. SAIF Partners retains an 8.71% stake after the sale.

“SAIF is one of our earliest investors and continues to be a great partner in our journey. We don't usually comment on individual instances of stake sales by our investors,” said Justdial CFO Ramkumar Krishnamachari in an emailed statement. SAIF Partners official declined to comment.

SAIF Partners was one of the first venture capital investors to back Justdial, when it invested Rs 55 crore in 2006. Over time the investment by SAIF, which has also backed travel portal MakeMy-Trip and BookMyShow, increased its investment to around Rs 70 crore.

This will be the second partial exit for the VC firm from Justdial. SAIF Partners held a 19.72% stake in Justdial before its public offering in June 2013, which fell to 11.2% after it sold a part of its holding in the IPO.

Other venture investors of Justdial include Tiger Global with 13.32% stake and Sequoia Capital which holds 13.21% stake. Interestingly, Sequoia also sold a very small portion, 0.5% stake, in Justdial during last quarter. Justdial shares closed at Rs 1567.5 on Thursday, down marginally by 0.36%.

Earlier this year, Justdial expanded its footprint from local search and listing to directly facilitating online transactions.

The company has started with 21 services like online food delivery, doctors appointments, selling electronics and taxi booking. Justdial has also taken its board’s approval to raise Rs 1,000 crore as it makes a push into the business.

Margins in the local search business have also been rising and consumers are increasingly using internet as compared to voice calling.

“Base business margin accretion is likely to be invested back to strengthen the Search Plus platform. We remain optimistic on Justdial’s leadership position in the local search business and the synergistic presence in ecommerce through Search Plus,” said a November report by Motilal Oswal analysts Niket Shah and Atul Mehra.

The move comes as Indian internet valuations reach a new high and VCs are starting to take some money off the table through partial exits.

ET also reported on Thursday that Bessemer Venture Partners, one of Snapdeal’s early investors, is selling a third of its holding in e-tailer to new investor SoftBank.