Just Dial . Downgraded to 'Hold' Rating Despite Strong Financial Performance

Just Dial ., a midcap IT software company, has recently been downgraded to a 'Hold' rating by MarketsMOJO on October 17, 2024. This decision was based on the company's low Debt to Equity ratio, which is currently at 0 times.
Despite this, Just Dial . has shown strong financial performance in the recent quarter, with a growth in Net Profit of 114.61%. The company has also declared positive results for the last 8 consecutive quarters, with its highest operating cash flow at Rs 259.22 Cr and highest net sales at Rs 284.83 cr. Its PBDIT (Profit Before Depreciation, Interest, and Taxes) is also at its highest at Rs 82.06 cr.

Technically, the stock is in a Mildly Bullish range and has multiple bullish indicators such as MACD, Bollinger Band, KST, and OBV. The majority shareholders of Just Dial . are its promoters, indicating their confidence in the company's performance.

In terms of market performance, Just Dial . has outperformed the market (BSE 500) with a return of 59.98% in the last year, compared to the market's return of 33.11%. However, the company's long-term growth has been poor, with a 3.17% annual growth in Net Sales and a -27.62% growth in Operating Profit over the last 5 years.

The stock currently has a high valuation with a Price to Book Value of 2.6 and a ROE (Return on Equity) of 9. However, it is trading at a discount compared to its average historical valuations. In the past year, while the stock has generated a return of 59.98%, its profits have only risen by 60.1%, resulting in a PEG (Price/Earnings to Growth) ratio of 0.5.

Overall, Just Dial . has shown strong financial performance in the recent quarter, but its long-term growth and valuation may be a cause for concern. Investors are advised to hold onto their stocks for now and monitor the company's performance closely.