Just Dial shares surged 10% on August 28, 2026, following a 'Buy' rating from Kotak Institutional Equities. The brokerage expressed confidence in new CEO Dinkar Ayilavarapu's strategy to improve merchant growth and collections. While the company maintains a strong cash position, investors are closely monitoring whether this leadership change can successfully address recent profit margin pressure.
Just Dial shares climbed 10 percent to hit the upper circuit on August 28, 2026, settling at Rs 704.55. This sharp movement follows a positive note from Kotak Institutional Equities, which maintained a 'Buy' rating on the company. The brokerage firm set a price target of Rs 1,175, citing optimism about the new executive direction.
Strategic Shift Under New Leadership
Dinkar Ayilavarapu officially took charge as the new CEO on August 1, 2026, succeeding founder VSS Mani. The brokerage’s confidence stems from his strategy to revitalize collections and focus on merchant acquisition. For years, the company has dealt with sluggish growth in collections, and market analysts view this leadership transition as a pivotal moment. The focus is now on strengthening the company’s business-to-business (B2B) segments where the competitive landscape is less intense.
Financial Performance and Margin Pressure
While the company’s revenue has shown growth, profitability metrics have faced challenges. In the June 2026 quarter (Q1 FY27), Just Dial reported revenue of Rs 327.5 crore, a 9.9 percent increase year-on-year. Net profit also rose by 4.1 percent to Rs 166.2 crore. However, operational efficiency remains a concern. The EBITDA margin, which measures core operational profitability, contracted to 26.7 percent. This indicates that rising operating and employee costs are currently putting pressure on margins.
Balance Sheet Strength and Risks
One of the company's key strengths remains its solid balance sheet. Just Dial is virtually debt-free and holds significant cash and investments, amounting to approximately Rs 6,022.1 crore as of June 30, 2026. This provides the company with the financial flexibility to fund its new growth strategies without relying on external borrowing.
However, investors should be aware of specific risks. The primary challenge is execution risk; the company must prove that the new CEO's strategies can effectively translate into faster collections and higher merchant conversions. Additionally, the recent trend of margin compression requires attention. If the company cannot control rising operating expenses, it may limit bottom-line growth even if revenue increases. The next important update for shareholders will be the management’s ability to stabilize margins while scaling up the new B2B initiatives in the upcoming quarters.