Earnings effect: Just Dial shares hit 52-week high; can they breach Rs 1,400 mark?

Shares of local search engine Just Dial rose 18% to their 52-week high on Thursday after the firm reported a stellar set of Q1 earnings. Net profit climbed 69.3% year-on-year (YoY) for the June 2024 quarter. Net profit rose to Rs 141.2 crore in Q1 against a net profit of Rs 83.4 crore in the June 2023 quarter.

Just Dial shares climbed 18.23% to a high of Rs 1224 in the current session against the previous close of Rs 1035.25 on BSE. The stock opened higher at Rs 1100 on BSE. Market cap of the firm rose to Rs 10,323 crore on BSE. Total 5.32 lakh shares of the firm changed hands amounting to a turnover of Rs 63.02 crore.

Revenue from operations surged 13.6% to Rs 280.5 crore in the last quarter against Rs 247 crore revenue in the corresponding period of the preceding fiscal.

Operating profit climbed 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.

JM Financial has reiterated its buy call on the Just Dial stock. The brokerage has raised its price target to Rs 1,300.

"We raise our EBITDA estimates over FY25-27 by 3-6% driven by 100-175 bps expansion in margin forecasts and expect Just Dial’s core profit after tax (i.e., ex-other income) to expand by 2.3 times from Rs 130 crore in FY24 to  Rs 300 crore in FY27. We roll forward to Sep’25 and now value the stock basis 20x core business EPS + Cash (vs. 18x earlier) to derive a revised price target of Rs 1,300 (vs. Rs 1,160 earlier)," said JM Financial.

ICICI Securities sees a 37% upside to the stock and assigned a price target of Rs 1,418 against the earlier price target of Rs 1,260.

"We maintain BUY on the stock with a revised target price of INR 1,418 (from INR 1,260) based on 18x one-year forward EV/EBITDA (earlier 14x) multiple as we roll over by six months. Key risks: 1) No clarity emerging on profit distribution in the near term; and 2) slower-than-expected growth in paid campaigns, listings etc," said the brokerage.

Just Dial provides local search related services to users in India through multiple platforms such as Desktop/ PC website, mobile site, mobile apps (Android, iOS, Windows), over the telephone and text. In February, it has launched its B2B portal, Jd Mart, across various platforms for users.