JM Financial maintains Buy on Just Dial, raises target price to Rs 1,250

JM Financial has maintained a Buy call on Just Dial with a revised target price of Rs 1,250 (Rs 1,220 earlier). The current market price of Just Dial is Rs 1,004 . The time period given by the analyst is a year when Just Dial Ltd. price can reach defined target. Just Dial, incorporated in 1993, is a Mid Cap company with a market cap of Rs 8509.98 crore, operating in the Services sector.

Just Dial's key products/revenue segments include Other Services for the year ending 31-Mar-2024.

Financials

For the quarter ended 31-03-2024, the company has reported a Consolidated Total Income of Rs 361.56 crore, up 6.37% from last quarter Total Income of Rs 339.90 crore and up 17.89% from last year same quarter Total Income of Rs 306.69 crore. The company has reported net profit after tax of Rs 115.74 crore in the latest quarter.

The company's top management includes Mr.B Anand, Mr.Anshuman Thakur, Ms.Geeta Fulwadaya, Mr.Ranjit Pandit, Ms.Bhama Krishnamurthy, Mr.Sanjay Bahadur, Mr.Malcolm Monteiro, Mr.Ashwin Khasgiwala, Mr.V Subramaniam, Mr.V S S Mani, Mr.Dinesh Taluja. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-12-2024, the company has a total of 8 Crore shares outstanding.


Investment Rationale

Just Dial's collections (lead indicator for revenue) grew in 4Q by 11.3% YoY, meaningfully better than JMFe of 7.0% as well as 9MFY25 growth of 5.6%. Sequential paid campaign additions too were robust at 12.2k versus JMFe of 7.7k and ahead of 8k/7k/3k in 1Q/2Q/3Q. While revenue grew 7.0% YoY (a miss on JMFe by c.1%), EBITDA jumped 22% YoY to Rs 861 million (ahead of our estimate by 3%) due to better-than-expected margin expansion. Traffic trend too was decent at 11.8% YoY, partly aided by a slight increase in A&P spend. While operating performance was better than expected, clarity on the company's cash distribution policy (refer our recent note) remains a key trigger for stock performance. Ex-cash and other income stock is extremely cheap at 8x FY26 PER, as current cash and investments itself account for ~67% of Just Dial?s market cap. JM Financial continues to use target PER multiple (ex-cash and other income) of 18x to arrive at Mar?26 TP of Rs 1,250.

Promoter/FII Holdings
Promoters held 74.15 per cent stake in the company as of 31-Dec-2024, while FIIs owned 7.31 per cent, DIIs 8.32 per cent.