We had recommended Just Dial in issue no. 20 dated September 5-18, 2016, under the ‘Analysis’ section when the scrip was trading at ₹498. Our recommendation was based on company’s strong financials, monopolistic presence in the market and launch of unique products in the online market.
Just Dial is an online multilinguistic directory which operates 24x7. The company also operates in the e-commerce segment through online shopping for consumers. The company offers voice and online platform for companies which get registered with it, generating revenues majorly through search-related services from paid listing services for SMES. On the financial front, Just Dial’s net sales increased by 1.17 per cent to ₹181.72 crore in Q4FY17 on a yearly basis.
The company’s profit after tax (PAT) declined by 28.24 per cent to ₹25.35 crore in Q4FY17, on a year-on-year basis, decreasing from ₹35.33 crore in Q4FY16. The company also posted decrease in its profit before interest, depreciation and tax (PBIDT) by 33.80 per cent to ₹34.51 crore in Q4FY17 on year-on-year basis, against a PBIDT of ₹52.13 crore in Q4FY16.
On an annual basis, the company posted an increase in its net sales by 4.02 per cent to ₹718.61 crore in FY17, as compared to the previous fiscal. The company’s PAT decreased by 14.42 per cent to ₹121.34 crore in FY17 on a yearly basis. The company’s PBIDT too got decreased for the fiscal 2017 to ₹156.48 crore, down by 20.62 per cent on a yearly basis.
After our recommendation, the share price of Just Dial dipped by about 23 per cent. The stock is on a downward trend, hence we had recommend investors to exit.