Update On :29 October 2014
Local search engine Just Dial is raising up to Rs 1,000 crore through issue of equity shares as it looks to moves into the highly competitive e-commerce space. The Mumbai-based firm disclosed its plans after its second quarter results, which saw its operating revenues rise 31% to Rs 147 crore.
The fundraise was approved by Just Dial's board on Monday, and is now awaiting shareholders approval. When contacted by ET, Just Dial founder and CEO VSS Mani confirmed the plans but declined to share any details.
Just Dial had launched its Search Plus business earlier this year, moving from just a listing and discovery platform to online transactions. The company had 20 such services on platform like ordering groceries, flowers, pharmaceuticals, electronics and booking doctors appointments covering 145,000 merchants. While these services are available on Just Dial website, they will also be available on mobile now.
A recent report by Nomura estimated that this business could have a GMV of $3.5 billion or Rs 21,000 crore in the next 10 years. The report also estimates that Just Dial will spend around Rs 25-40 crore this year in marketing the search plus business.
"We are positive on Justdial leveraging its leadership in local search by expanding into Search Plus services which should lead to synergistic benefits in its core search business, while enabling faster growth through targeting less-monetised product-vendor relationships," said the Nomura report.
E-commerce market in India is expected to reach $6 billion in 2015, a 70% increase over 2014, according to Gartner. The fast growing market is seeing competition between primarily three players - Flipkart, Amazon India and Snapdeal.
Scrip of Just Dial was up 3% at close of trade on Monday at Rs 1690.5, giving it a market capitalisation of Rs 11,867.31 crore.
Just Dial already has Rs 741 crore in cash and investments in the bank. The firm saw its net profit increase by 10% to Rs 31.49 crore second quarter of FY15.
Founded by Mani, Just Dial counts Sequoia Capital, SAIF Partners and Tiger Global as its investors.
Just Dial lists businesses of local merchants and conducts campaigns on the platform, for which it charges subscription fees. The number of campaigns for paid advertisers increased 24% to 296,100 and it has 14.5 million merchant listings on it as of September 2014.
News Source From : http://articles.economictimes.indiatimes.com/2014-10-21/news/55279509_1_local-search-engine-ceo-vss-mani-search-plus