Mumbai-based Just Dial Ltd, which runs an India-specific local business listings site, has re-filed for an initial public offering (IPO) which is set to give its venture capital investors a multi-bagger exit. Investors like SAIF Partners, Tiger Global Management and Sequoia Capital are set to make over 10x (10 times the capital invested), according to VCCircle analysis.
Although, Just Dial itself would not get any money out of the issue as the money raised would go to selling shareholders, the issue size for the public would make it the largest IPO by an Indian Internet firm. For a more detailed story on valuation and how the VC investors would mint cash from their investment click here.
The filing comes weeks after Just Dial raised Rs 327 crore ($57 million) in one of the largest pre-IPO round of venture funding, from existing investors Sequoia Capital and SAP Ventures.
The issue is aimed at giving liquidity and exits to Just Dial's investors as it's a completely secondary offering. The issue will see sale of 13.5 per cent stake primarily by existing shareholders SAIF Partners and Tiger Global Management.
Just Dial had earlier filed its draft red herring prospectus (DRHP) with the market regulator SEBI last year and got approval to go ahead with the issue. But given changes in the capital structure with the recent investment, Just Dial had to re-file its DRHP, said one source familiar with the development.
The source also said Just Dial would look at valuation of over Rs 4,000 crore (or more than $720 million). "Everything depends on when we get the regulatory approval. After getting Sebi nod, we will look at the market conditions and take board approval to decide on the price band and timing of the issue," Ramkumar Krishnamachari, chief financial officer of Just Dial Ltd, told VCCircle without divulging details.
With a market value of over Rs 4,000 crore, Just Dial would also be bigger than the other two large stock exchange listed Indian Internet firms- Info Edge (the company behind Naukri.com among others) and Nasdaq-listed MakeMyTrip have market cap of Rs 3,821 crore ($688 million) and $596 million, respectively.
Citigroup Global Markets India and Morgan Stanley India are the book running lead managers to the issue.
Revenues, business Model
Founded by VSS Mani in 1994, Just Dial is a local search firm that provides both B2C and B2B listings of small and medium businesses across the country. And it provides services across multiple platforms, including the Internet, phone, wireless and print.
Just Dial, with 7.7 million listings till June, 2012, follows a B2B model where local businesses pay for listings, to be featured among the company's search results (which it calls campaigns) on a priority basis. The number of campaigns had increased from an approximate 40,500 in March 31, 2009, to 181,000 till June 30, 2012. However, consumers/end-users do not have to pay to access these listings.
Just Dial's consolidated total income increased from Rs 71.6 crore in FY08 to Rs 277 crore in FY12, representing a CAGR of 40.2 per cent. Its profits after tax increased from Rs 1.71 crore in FY08 to Rs 52.3 crore in FY12.
(Edited by Prem Udayabhanu)