Just Dial Ltd - Apr 2025 Earnings Call Transcript Analysis

April 23, 2025 · 4 min read

Earnings Call Transcript Analysis Report #

Q4 FY'25 Revenue: INR 289.2 crores (+7% YoY)
Q4 FY'25 Operating EBITDA: INR 86.1 crores (+21.9% YoY)
Q4 FY'25 Operating EBITDA Margin: 29.8% (up from ~26.4% YoY)
Q4 FY'25 Operating PBT: INR 70.9 crores (+26.5% YoY)
Q4 FY'25 PAT: INR 157.6 crores (+36.3% YoY, aided by Other Income and lower ETR)
FY'25 Revenue: +9.5% YoY
FY'25 Operating EBITDA: +55% YoY
FY'25 Operating EBITDA Margin: 29.4%
FY'25 Operating PBT: INR 277.6 crores (+72% YoY)
FY'25 PAT: INR 584.2 crores (+61% YoY)
Collections (Q4 FY'25): INR 340 crores (+11.3% YoY). Marked improvement from previous quarters.
Deferred Revenue (Mar'25): INR 558 crores (+10% YoY)
Active Paid Campaigns (Mar'25): 613,290 (+5.1% YoY)
Cash & Investments (Mar'25): INR 5,279 crores (+14% YoY)
Quarterly Unique Visitors (Q4 FY'25): 191.3 million (+11.8% YoY). Mobile traffic grew 15% YoY.
Total Listings (Mar'25): 48.8 million (+11.9% YoY)

Q4 revenue growth (7% YoY) was slower than the full year (9.5% YoY) and initial mid-teens aspiration.
EBITDA growth significantly outpaced revenue growth due to controlled expenses (OpEx +1.7% YoY in Q4, Employee cost +0.9% YoY in Q4).
Collections growth accelerated significantly in Q4 (11.3% YoY) compared to the first three quarters (“6%, 7% kind of levels”).
FY'25 effective tax rate (ETR) was low at 12% due to deferred tax reversals on treasury assets shifting to long-term.

FY'26 ETR expected to normalize to “20%, 21% levels”.
Aspiration to accelerate top-line growth in FY'26 towards “mid-teens kind of number” while maintaining similar strong margin levels (around 29%+).
Advertising spend guidance for FY26: “around 2.5% to 3% of the top line”.

Strong growth in profitability (EBITDA, PBT, PAT) driven by margin expansion and cost control.
Healthy growth in traffic (especially mobile) and listings.
Accelerated collections growth in Q4 is a positive indicator.
Revenue growth for FY25 was below initial expectations. Paid campaign growth (5.1% YoY) lags traffic growth.

Shift in sales strategy: Reduced focus on “cold calling” telesales, increased focus on teams working “qualified leads” generated via advertising, leading to higher productivity.
Focus on efficiency and profitable growth.
Planned acceleration of top-line growth through advertising (users and merchants) and “adequate price increases in underpriced categories and geographies.”

Online Shopping Initiative: Planning to launch a beta version next quarter. Positioned as an aggregator for businesses with existing online shopping capabilities (B2C & B2B), directing traffic to their sites. Monetization planned via sponsored listings initially, potentially moving to commission/referral later.
Dynamic Pricing for Non-Premium Listings: Moving from geography-based pricing to dynamic pricing based on keyword/category for non-premium listings (which contribute ~50% revenue).
AI Integration: Using AI for review summaries, prompting quality user reviews, merchant content creation (catalog descriptions, image enhancement), creating short videos/reels from merchant portfolios, and scoring sales leads.

Rationalization of the “bottom 10%, 20% of the sales team” and elimination of the “cold calling telesales team”.
Potential increase in advertising spend, possibly including non-digital channels like multiplexes.

Focus on improving B2B monetization: While B2B traffic share is increasing (~20%), revenue contribution remains stable (~26.5%). Focus is on improving realization.
Enhancing listing richness: Adding more service catalogs, videos, and rich content to listings.

Management noted the global focus on “businesses with positive unit economics, businesses with high returns”. Also acknowledged the dynamic nature of SME advertising where businesses frequently enter/exit platforms or adjust spend seasonally.

Management defended Just Dial’s comprehensive local search focus in India when challenged regarding competition (Google, IndiaMART) and data accuracy.
The new online shopping initiative appears positioned as an aggregator/traffic driver rather than a direct e-commerce competitor initially.

Macro environment and events like elections/festivals impacted FY25 collections initially.
Opportunity seen in increasing realization through dynamic pricing and targeting underpriced segments.
Significant opportunity in Tier 2/3 cities where realization is lower than Tier 1.
B2B monetization remains an opportunity given rising traffic share.

Top 11 cities contribute 56.5% of revenue (down slightly from 58% YoY) but only 40% of campaign volume (stable YoY), indicating higher realization in top cities. B2B traffic share growing towards 20%.

FY'25 top-line growth missed initial mid-teens target.
Delay in finalizing and communicating the capital allocation policy (dividend/buyback) despite previous indications.
Analyst feedback regarding defunct numbers and search result inaccuracy.

←

→