JUSTDIAL - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

📊 Investment Analysis: JUSTDIAL (₹850)

Investment Rating: 2.6

Based on the metrics provided, JUSTDIAL exhibits some strengths but also flags several concerns for a long-term investor. Here's a deeper dive

🚦 Key Investment Metrics

High P/E (51.9) vs Industry P/E (26.4)

Indicates overvaluation unless strong growth justifies the premium.

PEG Ratio: 64.8

Extremely high, suggests current price far exceeds realistic earnings growth expectations.

ROE: 3.63%, ROCE: 4.81%

Low efficiency in generating returns from capital and equity. Below ideal levels (>15% is preferred for high-quality businesses).

Dividend Yield: 0.00%

No income generation via dividends; not attractive for yield-seeking investors.

Debt-to-Equity: 0.02

✅ Very low debt—financially conservative and stable.

EPS: ₹42.7, Book Value: ₹473

Price/Book Ratio = ~1.8 — not overly expensive, but not deeply undervalued either.

PAT Growth Q/Q: 24% (49 Cr → 39.6 Cr)

Good recent profit momentum, but needs sustainability over multiple quarters.

RSI: 33.4, MACD: -14.9

Near oversold territory, could suggest upcoming reversal if supported by volumes.

DMA Trends (50 DMA: ₹896, 200 DMA: ₹934)

Price is below both averages, signaling short-term weakness and bearish sentiment.

FII & DII Holding Change: Negative

Institutional investors are reducing exposure, dampening confidence.

🎯 Ideal Entry Price Zone

Considering valuations and technical trends

Entry Zone: ₹725–₹775

Closer to the 52-week low (₹700) and provides better margin of safety.

Watch for RSI crossing 40 and MACD narrowing for reversal signs.

🛣️ Exit Strategy / Holding Period

If you already hold the stock

Holding Period: Short-to-Medium term (6–18 months) unless growth metrics improve significantly.

Monitor: ROE/ROCE trends, sustainability of PAT growth, and PEG ratio compression.

Exit Targets

Near ₹950–₹1,000 if momentum returns and fundamentals stabilize.

Consider gradual exit if it rebounds but growth and efficiency remain weak.

📌 Verdict

JUSTDIAL shows signs of profit uptick but lacks solid fundamentals for a high-conviction long-term hold. With lofty valuation metrics and low returns on capital, it’s best approached cautiously unless future quarters show dramatic and sustained improvement.

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