Just Dial targets collections growth revival under new management and B2B expansion

Investment View and Management Change

Kotak Securities’ August 28, 2026 company update on Just Dial retains a BUY recommendation. The recommendation is based principally on the potential for new management to revive operating growth and the stock’s cash-backed valuation.

Dinkar Ayilavarapu has taken over as Chief Executive Officer from VSS Mani. Kotak believes the new management is likely to increase its focus on merchant acquisition and return on investment, seek stronger collections growth, and pursue verticals where competition is limited or absent.

Collections Growth and Operating Outlook

The key operating concern is subdued collections growth. Just Dial’s collections growth was only 1.6 per cent year-on-year in FY26, following muted growth of 2-7 per cent during FY25-26.

Kotak identifies the following as the primary future growth drivers:

• Growth in paid campaigns
• New product launches
• Onboarding of business-to-business merchants

The broker believes the new management will seek to restore collections growth to double digits. This is an expectation rather than company guidance stated in the report.

Monetisation Opportunity

Monetisation remains an important opportunity as well as a challenge. As of June 30, 2026, Just Dial had 5.6 crore listings on its platform, but only 60 lakh listings were monetised.

Kotak’s thesis depends on improved execution in merchant acquisition, campaign growth, product launches and monetisation of the large platform base.

Valuation and Potential Catalysts

Kotak increased its fair value to Rs 1,175 from Rs 1,100. The valuation uses a target multiple of 10 times September 2028E core price-to-earnings, plus cash.

The broker continues to view the stock as a value pick because Just Dial’s cash on books is higher than its market capitalisation. Any board intention to return cash to shareholders could be an additional stock-price trigger.

Key Risks

• Collections growth remains weak.
• Paid campaigns and new products do not gain sufficient traction.
• Merchant acquisition and return on investment initiatives do not improve execution.
• The large pool of unmonetised listings is not converted into revenue.

Kotak’s 12-month fair value is Rs 1,175 against a CMP of Rs 642.