Just Dial's strong debut: How are brokerages rating it

Moneycontrol Bureau

Just Dial has seen a strong debut on Dalal Street and lists with a 13 percent premium to issue price. At 11:26 hrs the stock was quoting at Rs 620.30, up Rs 90.30, or 17.04 percent on the BSE.

The company has already raised over Rs 208 crore through issue of 39.37 lakh equity shares to anchor investors.

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In an interview to CNBC-TV18, the management tells the company will improve margins by 2-2.5 percent going forward. The service provider company sees increase in traffic towards internet to enhance margins going ahead.

So, how are brokerages rating the debut listing?

Motilal Oswal has initiated 'buy' rating on the company with a target price of Rs 660. The brokerage expects Just Dial to post revenue CAGR of 33% over FY12-15E.

However, Ambit is not so impressed with the listing and has a 'sell' rating on the company.  According to Ambit, its fair value stands at Rs 420 per share. 

Ambit does not see Just Dial retaining its dominance going forward. It expects both the topline and bottomline to grow by 25 percent going ahead.

"Given the punchy valuations we remain negative on current valuations and would urge buyers to sell into any pop today," Ambit adds.