JUSTDIAL - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 3.2

📊 Financials Overview:

• Revenue & Profitability: Quarterly PAT declined from 160 Cr. to 119 Cr. (-22.5%), showing earnings pressure.
• Margins: ROE at 6.18% and ROCE at 7.11% indicate weak efficiency compared to peers.
• Debt: Debt-to-equity at 0.02 reflects a debt-free balance sheet, which is positive.
• Cash Flow: Dividend yield at 0.00% means no direct shareholder returns.

💹 Valuation Indicators:

• P/E Ratio: 10.9 vs Industry PE of 30.1 → undervalued relative to peers.
• P/B Ratio: Current Price / Book Value ≈ 1.27 → trading close to book value.
• PEG Ratio: 0.07 → suggests undervaluation relative to growth potential.
• Intrinsic Value: Current price (₹730) is near fair zone; undervaluation closer to ₹700–₹720.

🏢 Business Model & Competitive Advantage:

• JustDial operates as a local search engine and digital services provider.
• Competitive advantage lies in brand recognition and established user base.
• However, rising competition from digital platforms and declining profitability limit growth prospects.

📈 Entry Zone & Holding Guidance:

• Entry Zone: Attractive near ₹700–₹720 (aligned with 52-week low).
• Long-Term Holding: Suitable for value investors seeking undervalued digital exposure; risks remain due to weak margins.

Positive

• Debt-free balance sheet (Debt-to-equity 0.02).
• DII holdings increased (+0.25%), showing domestic investor confidence.
• PEG ratio (0.07) suggests undervaluation relative to growth.

Limitation

• ROE (6.18%) and ROCE (7.11%) are weak compared to peers.
• No dividend yield, limiting shareholder returns.
• Quarterly PAT declined (-22.5%), showing earnings pressure.

Company Negative News

• FII holdings decreased (-0.56%), showing reduced foreign investor confidence.
• Quarterly PAT fell from 160 Cr. to 119 Cr.

Company Positive News

• DII holdings increased (+0.25%), reflecting domestic support.
• Strong brand recognition in local search and digital services.

Industry

• Industry PE at 30.1, much higher than JustDial’s valuation (P/E 10.9).
• Digital services industry benefits from rising internet penetration and online consumption trends.

Conclusion

⚖️ JustDial is undervalued compared to industry peers and maintains a debt-free balance sheet. However, weak profitability and declining margins limit attractiveness. Investors may consider entry near ₹700–₹720 for better risk-reward. Long-term holding is speculative and depends on the company’s ability to revive growth and strengthen efficiency.