Just Dial shares skyrocketed over 11 percent to Rs 1,156 per share on July 18, following a strong performance in the April-June quarter (Q1FY25), aligning with market expectations.
In Q1FY25, Just Dial's net profit soared by 69.3 percent year-on-year to Rs 141.2 crore, while revenue from operations climbed by 13.6 percent YoY to Rs 280 crore.
At the operational level, EBITDA rose to Rs 80.5 crore in Q1FY25 from Rs 36.6 crore in the same period last year, with the EBITDA margin significantly improving to 28.7 percent from 14.8 percent in Q1FY24, due to rationalized employee costs.
However, Kotak Institutional Equities analysts noted that Just Dial will need to hire more employees to sustain future growth.
In Q1FY25, employee costs dropped by 5.3 percent YoY due to a 15 percent YoY reduction in headcount, a trend observed over the past four quarters. Other expenses decreased by 2.5 percent YoY, likely due to reduced advertising expenditures.
Just Dial reported 181.3 million unique visitors, reflecting a 5.7 percent YoY and 6 percent quarter-on-quarter increase in Q1FY25. Active listings reached 44.9 million as of June 30, 2024, marking an 18.2 percent YoY growth.
Kotak analysts predict that lower-than-expected costs will drive a 3-7 percent increase in EBITDA moving forward. They value Just Dial at 17x ex-cash P/E multiple, including the value of cash, and maintain a 'buy' rating with a target price of Rs 1,240 per share, despite long-term growth concerns.
This year, the local search engine's stock has surged over 29 percent, compared to the Nifty 50's 12 percent increase. On April 30, 2024, Just Dial reached a 52-week high of Rs 1,162 per share.
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