JustDial hits the roof on 3x rise in Q3 profit; brokerages see 17% upside

Share price of JustDial gained over 10 percent after the market opened on January 16 as the company reported 287.7 percent year-on-year (YoY) growth in Q3 FY23 net profit at Rs 75.32 crore.

Net revenue from operations was up 39.32 per cent to Rs 221.37 crore during the quarter under review as against Rs 158.89 crore of the corresponding quarter last year.

At 9:20 am, the stock was quoting at Rs 644.30 apiece on the NSE, hitting the upper circuit higher by 10 percent.

Trading volumes at 518,072 were twice the 20-day average volume of 201,460. The stock’s last big single-day jump of 10 percent was on 12 April, 2022. Prior to that, it had jumped over 13 percent on 20 January, 2022.

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The online classifieds company's adjusted operating EBITDA (earnings before interest, tax, depreciation and amortization), excluding ESOP expenses, stood at Rs 29.4 crore, higher by 194 percent YoY and 51.1 percent on a quarterly basis.

“The company had ramped up hiring in previous 3-4 quarters across technology, content, sales and marketing teams which resulted in higher employee expenses in recent quarters,” JustDial said in an exchange filing.

“However, operating expenses growth remained controlled in 3Q FY23 and operating leverage benefits are playing out,” it added.

Total traffic (unique visitors) for the quarter grew 9.8 percent YoY to 156.8 million and total active listings increased 11.4 percent YoY to 35 million.

ICICI Securities has a Buy rating on the stock with a target price of Rs 750 apiece. “The stock is trading at compelling valuation of ~5x 1-year forward EV/EBITDA,” it noted.

The company has cash balance of Rs 3934 crore while its market cap is about Rs 5300 crore. Foreign brokerage firm Citi also has a Buy rating on the stock with a target price of Rs 735.