Just Dial Ltd Management Discussions

Economic overview

Global economic overview

The global economy held firm through FY 2025-26 despite geopolitical tensions, shifting trade dynamics and uneven regional growth, supported by resilient emerging-market demand, targeted fiscal measures and heavy investment in technology. The latter part of the year brought fresh uncertainty as conflict in the Middle East disrupted energy markets. According to the IMF World Economic Outlook (April 2026), global real GDP growth is set to ease to 3.1% in 2026 and edge up to 3.2% in 2027, after 3.4% in 2025, with the moderation reflecting the prevailing conflict and trade-policy uncertainty.

Advanced economies are projected to grow at a measured pace, around 1.8% in 2026, with the United States leading at 2.3% on fiscal support and technology investment, while the Euro Area is likely to remain structurally constrained at 1.1%. Emerging and developing economies are anticipated to expand faster, at 3.9% in 2026 and 4.2% in 2027; the economy of China is projected to grow at 4.4%, and South Asia, led by India, will continue to anchor global growth. Global inflation, having eased to 4.1% in 2025, is likely to tick up to 4.4% in 2026 before moderating to 3.7% in 2027.

For Justdial, the structural shift towards digital ecosystems is the material read-through: deeper reliance on platform-based discovery and SME digitisation strengthens The Companys relevance, while its predominantly domestic, consumption-led model limits direct exposure to global volatility.

Global GDP growth outlook (% change, real GDP)

India remained the fastest-growing major economy in FY 2025-26, underpinned by strong domestic demand, policy continuity and structural reforms. The Second Advance Estimates released by the National Statistics Office in February 2026, under the revised 2022-23 base year, place real GDP growth at 7.6% (revised up from 7.4%) and nominal growth at 8.6%, taking the size of the economy to about Rs 345.5 trillion (US$3.96 trillion). This was achieved against a backdrop of global trade volatility, aided by trade normalisation with the United States, continued GST rationalisation, labour reforms, income tax relief and sustained public capital expenditure.

Domestic demand was the primary engine, with private consumption accounting for 58–60% of GDP and a balanced rural–urban recovery. Rural spending was supported by a favourable monsoon and record kharif output, while urban demand benefited from income tax relief. Public capital expenditure rose from Rs 2 trillion in FY 2014–15 to Rs 11.2 trillion in FY 2025-26, and is budgeted higher at Rs 12.2 trillion for FY 2026–27, while gross fixed capital formation held near 34% of GDP. On the supply side, manufacturing posted double-digit growth under the PLI schemes, services (53–55% of gross value added) stayed the principal driver, and agriculture grew about 3.1%.

This broad-based expansion widens Justdials addressable market; a more diverse enterprise base deepens listings across B2B and consumer categories, while rising consumption and formalisation increase both search activity and merchants willingness to invest in digital visibility.

7.6%

Real GDP growth, FY 2025-26

8.6%

Nominal GDP growth, FY 2025-26

Rs 345.5 Tn

Size of the economy (nominal)

Indias digital economy has matured into a structural pillar of growth. Total internet subscribers crossed one billion during the year, reaching 1,028.61 million by December 2025. India is now the third-largest technology start-up ecosystem globally and hosts over 1,900 Global Capability Centres, with public-cloud spending projected near US$13 billion by 2026 and the country ranked 38th in the Global Innovation Index 2025. Physical and digital infrastructure advanced in parallel; the national highway network is around 60% larger than a decade ago, railway commissioning exceeds 5,300 km a year, and investment in 5G, BharatNet and data centre capacity continues to extend reach into Tier II and Tier III markets.

For Justdial, these enablers translate into higher search intensity, broader business participation and deeper penetration of non-metro markets, expanding both the user and merchant base the platform serves.

Sources:

- IMF, World Economic Outlook, April 2026;

- National Statistics Office (NSO), Second Advance Estimates of National Income, FY 2025-26 (February 2026);

- Union Budget 2026·27; Ministry of Finance / PIB;

- IBEF, Indian Economy and Economic Survey 2025·26.

Indias telecommunications and internet sector reached a structural milestone in FY 2025-26, with broadband subscribers crossing one billion for the first time. Aggregate broadband subscribers stood at 1,065.9 million as of March 2026, of which 1,019.4 million were wireless, underscoring the dominance of mobile-first access. Connectivity at this scale has turned the internet into a near-ubiquitous utility, reshaping how consumers discover, evaluate and transact with local businesses and lifting the relevance of real-time, location-based search.

The rollout of 5G, now available across nearly all districts, is improving speed, latency and reliability, while digital payments have scaled sharply: UPI recorded 21.7 billion transactions in January 2026, up 28% year-on-year, worth Rs 28.3 trillion. Rural India is emerging as the key driver of incremental adoption through BharatNet and related initiatives, though rural tele-density well below urban levels signals substantial headroom. AI is increasingly embedded across consumer and enterprise applications, supported by the IndiaAI Mission, enabling personalised search, natural-language interfaces and better lead matching, with adoption strongest among younger users.

For Justdial, these shifts enlarge the addressable user base, raise engagement intensity and tighten the link between discovery and transaction, directly supporting deeper market penetration and stronger monetisation.

Telecom metrics (as of March 31, 2026)

958 Mn

Active internet users (2025)

548 Mn

Rural active internet users (2025)

44%

Users engaging with AI features (2025)

The MSME sector remains a cornerstone of Indias economy and the core of Justdials ecosystem. With over 74.7 million enterprises employing more than 328.2 million people, it is the second-largest source of employment after agriculture. As set out in the Union Budget 2026–27, MSMEs account for roughly 35.4% of manufacturing output, 48.6% of exports and 31.1% of GDP. Formalisation continues to gain pace: over 79 million enterprises had registered on the Udyam Portal and Udyam Assist Platform by December 2025, improving access to credit, government schemes and digital infrastructure.

Digital adoption is deepening alongside formalisation. The Government e-Marketplace has expanded to over 2.2 million sellers; UPI has improved transaction efficiency among micro-enterprises; and the Trade Receivables Discounting System has unlocked more than Rs 7.0 trillion in liquidity, reinforced by the budget mandate for CPSEs to route MSME payments through it. Credit accessibility has expanded through several key initiatives: the ongoing growth of CGTMSE, more than Rs 37 billion in cumulative ECLGS disbursements, and the introduction of a new Rs 100 billion SME Growth Fund. Additionally, the Self-Reliant India Fund has deployed over Rs 154.4 billion across 682 MSMEs as of November 2025, alongside a dedicated credit card scheme providing up to Rs 0.5 million limits for one million Udyam-registered micro-units. The Corporate Mitras programme will place accredited professionals across Tier II and Tier III markets to deepen compliance and formalisation.

This convergence of formalisation, digital infrastructure and policy-led credit is structurally favourable for Justdial: it enlarges the base of potential advertisers and service providers and lifts demand for digital discovery, lead generation and performance-driven marketing.

- TRAI, Telecom Subscription Data, March 2026.

- NPCI, UPI statistics, January 2026.

- IAMAI·Kantar, Internet in India Report 2025.

- Union Budget 2026·27; PIB; IBEF, MSME sector.

Company overview

Justdial is Indias leading local search platform, connecting users with businesses, products and services across categories, geographies and access points. For more than three decades, it has built one of the countrys largest databases of local enterprises, enriched by verified ratings, reviews and multimedia content and accessible through apps, mobile sites, the web and voice. The Company operates a two-sided marketplace at the intersection of consumer intent and Indias MSME economy: users discover trusted providers and make informed decisions, while businesses strengthen visibility, generate leads and participate more effectively in a digital marketplace. Its position rests on long-standing local expertise, a pan-India merchant network, proprietary technology and a subscription-led, debt-free financial model.

Justdials ecosystem is organised around a single purpose, connecting users searching for trusted local services with businesses seeking to be discovered. Users reach the platform through Android and iOS apps, mobile site, desktop, conversational interfaces, including WhatsApp; and the 88888 88888 voice hotline, supported by a verified ratings-and-reviews framework and structured enquiry tools such as Request for Quotes. During the year, the Company advanced its AI-led discovery experience, led by Ask Anything, alongside multilingual and voice search and review summarisation.

On the merchant side, an integrated suite supports the full journey from listing to transaction: JD Business for profile and lead management, JD Omni for transaction-ready websites, JD Pay for integrated payments, JD Analytics for performance insight, and JD Mart for B2B commerce, with Universal Business Listing enabling reputation management across Justdial, Google and major social platforms from one dashboard. The flagship launch of the year, the JD Sixer Pack, consolidated six of the most-used merchant capabilities – Parallel calling, leads dashboard, CRM tools, review management, business dashboard and competition trends into a single release. The platforms reach spans over 250 cities and 11,000-plus pin codes, supported by field and tele-sales teams that extend well into Tier II and Tier III markets.

Operating metrics strengthened over the year: active business listings rose to 54.7 million, total ratings and reviews to 157.1 million, and active paid campaigns to 631,530, with average quarterly unique visitors of 189.4 million.

Revenue from operations grew 6.3% to Rs 12,138.6 million in FY 2025-26, reflecting deeper customer engagement, wider merchant participation and broader take-up of the Companys digital solutions. Operating EBITDA rose 6.6% to Rs 3,575.2 million, with the margin steady at 29.5% (FY 2024–25: 29.4%), demonstrating disciplined cost management as the business scaled. The Company remained debt-free, funded by advance collections under its prepaid subscription model, which supports negative working capital and strong revenue visibility.

Financial highlights

Total income rose 1.3% to Rs 15,477.2 million. Profit after tax was Rs 4,970.2 million, against Rs 5,842.0 million in the prior year; the decline reflects lower non-operating and treasury income rather than any weakening of core operations, which improved on every operating measure. Consequently, earnings per share stood at Rs 58.44 (FY 2024–25: Rs 68.70) and return on net worth at 10.2%, computed on an average net worth of Rs 48,564.9 million. The Companys treasury and investment corpus provides a substantial liquidity cushion and continued capacity to reinvest in technology, sales capability and product development.

Key Financial Ratios

(a) Interest coverage ratio is calculated on interest over profit before interest, tax, and exceptional items. Interest includes lease interest under the new accounting standard. The Company does not have debt in the form of loans or borrowings. The increase is attributable to higher profits during the year.

(b) Current ratio is calculated as current assets over current liabilities. The increase is attributable to increase in current assets during the year.

(c) The Company does not have debt in the form of loans or borrowings. Debt equity ratio is calculated as total liabilities over total equity.

(d) Operating profit margin is calculated as profit before interest, tax, depreciation and exceptional items over operating revenue.

(e) Net profit margin is calculated as profit after tax divided by total income (operating revenue + other income).

(f) Return on net worth is calculated based on average net worth. The decrease in networth is due to lower profit after tax.

(g) Debtors and Inventory turnover ratio is not applicable because The Company does not have debtors or inventory.

We operate in a single reporting segment named Search and Search-related Services.

For Justdial, the structural shift lies in how consumers discover local businesses and how MSMEs adapt to stay visible.

Discovery is changing: Search is moving to voice and AI — 44% of internet users engage with AI features, 65% use voice search — yet users still rely on ranked listings, reviews and trust indicators, the core proposition Justdial serves.

The MSME opportunity: Over 90% of MSMEs accept digital payments but only 13% use digital marketing, even as digital ad spend nears Rs 560 billion in FY 2025-26 — an opening for Justdial platform that simplifies discovery.

Beyond the metros: Rural adoption is growing four times faster than urban, with 579 million Indians yet to come online — the next wave Justdial is positioned to serve.

We face diverse risks in our dynamic environment and thus being prepared is key to navigating our challenges and creating value. Maintaining an effective risk management profile is vital for sustaining our success. The principal risks and The Companys responses are summarised below.

Indias MSMEs are positioned for broad-based growth, supported by rising internet access, steady formalisation and firm policy backing. The sector sits among the core engines of the governments Viksit Bharat 2047 agenda, alongside agriculture, investment and exports, with revised classification limits from April 2025 and an enlarged credit guarantee cover giving enterprises room to scale while retaining their MSME benefits and access to formal credit. The path ahead rests on deeper digital integration, easier access to formal financing and wider public procurement platforms, while AI, cloud and analytics reshape how smaller enterprises operate, lifting their scale and competitiveness, most visibly across Tier I to Tier V markets. Support for women-led and rural enterprises keeps this growth inclusive, and further policy reform and targeted skilling strengthen workforce capability and resilience. As India moves towards voice-led, vernacular and AI-assisted discovery, we have a clear opportunity to quicken MSME digitisation across the economy.

Technology underpins every part of the platform: how users search and decide, how merchants manage their presence, and how internal teams operate. During the year, The Company deepened its investment in AI and automation across discovery, merchant tools and operational systems. User-facing intelligence, led by the Ask Anything search experience, was strengthened by multilingual and voice search, semantic and vector models, review summarisation and predictive suggestions. Merchant systems added faster onboarding through signboard and visiting-card extraction and instant KYC, automated review responses under the UBL framework, and lead management that converts missed calls into qualified enquiries. An MCP framework now allows external AI engines to access Justdial data securely, routing high-intent queries into incremental traffic and leads.

Every interaction on the platform is supported by the people behind it, a workforce of 13,070 spanning sales, support, technology, content and corporate functions. During the year, The Company strengthened the employee lifecycle through a connected set of initiatives across hiring, onboarding, lateral progression, leadership and retention, including the Manager Development Programme and a Red, Amber and Green (RAG)-based employee-connect framework, alongside capability building through the Foundation Skills Academy and an ongoing employee-well-being programme.

The Company maintains internal control systems commensurate with the size, scale and nature of its operations, designed to provide reasonable assurance of the efficiency of operations, the reliability of financial reporting, the safeguarding of assets and compliance with applicable laws and regulations. These controls are supported by documented policies and procedures, defined authorisation matrices and increasing automation across finance and HR processes. The internal audit function reviews their adequacy and effectiveness on a periodic basis, and its observations, together with managements responses and corrective actions, are placed before the Audit Committee, which monitors implementation and reports to the Board.

Statements in this Management Discussion and Analysis describing The Companys objectives, projections, estimates and expectations may constitute forward-looking statements within the meaning of applicable securities laws and regulations. These statements are based on certain assumptions and expectations of future events, and actual results could differ materially from those expressed or implied. Important influencing factors include economic conditions in the markets served, changes in government regulation, tax laws and other statutes, and other incidental factors. The Company assumes no responsibility to publicly amend or revise any forward-looking statement on the basis of subsequent developments, information or events.