SUMMARY
Overall, The Q3 Performance Of Just Dial Had Been Positive, But The Numbers Indicate The Ongoing Struggle Too
The hyperlocal search engine Just Dial has reported a 4.2% YoY increase in net profit for its third fiscal quarter ended December 31, 2017. However, the net profit has dropped by 23.7% in Q317 to $4.48 Mn (INR 28.6 Cr) from the previous quarter.
For the fiscal quarter ending on September 30, 2017, the company saw a net profit of $5.7 Mn (INR 37.5 Cr), claiming a 26.5% Y-o-Y rise for Q2 FY 17-18.
Further, as per its earnings release, the total operating revenue stood at $30.8 Mn (INR 196.8 Cr), witnessing a growth of 9.2% YoY and 1.2% QoQ. Also, the company saw a YoY rise in its Cash and Investments which stood at $170 Mn (INR1,085.3 Cr) as on December 31, 2017, compared to $151.7 Mn (INR 967.7 Cr) as on December 31, 2016.
Overall, the performance of the hyperlocal search engine in Q317 had been positive as indicated by the growth numbers in various segments, however, the company seems to be struggling in gaining an uptick on its net profits, amidst rising cost of customer acquisition and fierce competition posed by the upcoming players in the hyperlocal space.
JUST DIAL LTD – 3Q FY18 PERFORMANCE SUMMARY
- Mobile users generated the maximum traffic for the Just Dial platform. Traffic (Unique Visitors) for the quarter stood at 107.6 Mn, up 33.6% YoY and 2.4% QoQ. Here, 68.4% traffic originated on mobile platforms, 23.3% on desktop/ PC and 8.3% on our Voice platform.
- Total Active Listings stood at 20.7 Mn as on December 31, 2017, an increase of 19.7% YoY, 4.6% QoQ. 908,973 listings were added (net) to the database during the quarter. Out of total listings, 10.1 Mn listings were geocoded as on December 31, 2017, up 60.8% YoY and up 10.1% QoQ.
- Total images in listings stood at 41.4 Mn, up 48.3% YoY and up 7.7% QoQ.
- Total Ratings & Reviews stood at 79 Mn at the end of quarter, up 16.4% YoY and up 3.8% QoQ.
- Paid Campaigns at the end of quarter stood at 440,600, up 3.7% YoY and up 0.2% QoQ.
Just Dial: Battling With Fierce Competition In Hyper Local Segment
JustDial was founded in 1994 by VSS Mani. The official website was launched in 2007. It is a local search firm that provides both B2C and B2B listings of small and medium businesses across 240 cities in India. The search service is available to users across multiple platforms, such as internet, over telephone (voice) and text (SMS).
JustDial opened its IPO in 2013, which at the time was hailed as the biggest issue since Bharti Infratel Ltd’s IPO in December 2012. In 2014, SAIF Partners sold 2.4% stake in JustDial which helped it earn returns of over 30 times in comparison to funds that it had invested. However, over the last one year, the company’s performance in the stock market has been steadily declining.
In January 2016, JustDial raised $18 Mn (INR 120 Cr) from Singapore-based Private equity investment firm Nalanda Capital. With the investment, Nalanda’s total stake in the company increased by 2% to 7.58%. The other two major shareholders of JustDial are Sequoia Capital and SAIF Partners. Tiger Global, EGCS and SAP Ventures have also invested in the company.
Recently, in July, the board approved the search company’s open market buyback proposal. As part of the buyback, which opened on August 9 and closed on September 25, JustDial bought 2.2 Mn of its own equity shares at $5.7 (INR 374.18) apiece, aggregating $12.8 Mn (INR 83.85 Cr) in the process.
In order to get a level playing field with its fellow hyperlocal delivery apps, JustDial also reportedly made a soft entry into India’s ecommerce space in May 2015 through tie-ups with restaurants, grocers, pharmacies and electronic stores for home delivery. The service started with Andheri in Mumbai and slowly expanded to other areas of the city.
In a bid to further enhance profit, the company also came up with a ‘one-stop’ app in February 2016, with plans to take JustDial global along with its ecommerce model. But despite all efforts, once valued at $1 Bn in 2013, JustDial has still been struggling to tackle competition from its immediate rivals UrbanClap, HouseJoy, and LocalOye. At the same time, even biggies like Flipkart (with its one-stop app) and Google (Areo) are also stepping ahead to take a bite in the Indian hyperlocal pie.
Recently, Just Dial was said to be in acquisition talks with search engine giant Google, however, even after the months of meetings, the deal could not be materialised.
Although the Q317 performance has been positive for the hyperlocal search engine, going ahead will Just Dial be able to maintain its share amidst the rising brigade of hyperlocal apps in India.
