Just Dial wants more paying merchants. Software is its next big bet

Just Dial Ltd, Reliance Group's business listings and search platform, plans to remain focused on helping consumers discover merchants rather than investing in order fulfilment infrastructure, as it looks to revamp its core offerings, a top company executive told Mint.

Just Dial, which currently generates most of its revenue from paid listings and subscriptions, is now testing new merchant software products to expand its offerings, its chief executive officer (CEO) Dinkar Ayilavarapu said.

"The products are in the lab right now, but they have already been tested with hundreds of merchants. And initial responses are awesome," he said. "This will come out into the world sooner rather than later."

Ayilavarapu, a Bain & Co. veteran who joined Just Dial in July after leading Flipkart's strategy and then its business-to-business arm Flipkart Wholesale, said that the company is now focusing on increasing merchant count and average revenue per user (ARPU) by adding software tools alongside traditional paid search listings.

While commerce platforms over the past five years have built out transaction capabilities, Ayilavarapu said his immediate priority is not to expand further into B2B commerce or business-to-consumer commerce marketplace models involving returns and logistics. Instead, Just Dial plans to centre operations around what he termed as 'Discovery plus plus.'

The revamp will go beyond software upgrades to include exploring lower entry-level pricing to expand the base of paying small and medium business subscribers, he said.

"We are anchored in discovery, and have a massive B2C merchant base. We run a lightweight subscription model rather than a heavy marketplace model with returns and fulfillment logistics. As a 10,000+ employee company, we stay true to our core competencies," he added.

Just Dial shares settled 1.4% lower at ₹688.45 apiece on the BSE on Tuesday.

Growth challenges

Once a dominant player as India's premier telephone-based directory, the platform struggled to sustain consumer mindshare as the digital landscape shifted toward hyperspecialised mobile phone applications.

Reliance acquired Just Dial in 2021 via its retail ventures arm Reliance Retail Ventures Ltd. Just Dial's board of directors now includes Ashwin Khasgiwala, chief of business operations at Reliance Retail, and Anshuman Thakur, who heads strategy and planning at Jio Platforms.

Since its acquisition, Just Dial has continued to rely on revenue from merchant contracts, with revenue from operations rising at a compound annual growth rate (CAGR) of 17% from 2022 to reach ₹1,214 crore in FY26. Collections growth, however, remained subdued with a 1.6% year-on-year growth during the year ended 31 March 2026.

As of 30 September, Just Dial had 57.4 million active listings, up 2.3% from 56.1 million on 30 June. Of these, only 656,520 were paid campaigns in the September quarter, highlighting the gap between the platform's overall listings and its paying merchant base.

Monetization under scrutiny

Analysts tracking the stock remain sceptical about Just Dial's long-term growth prospects. In a note dated 15 April 2026, a few months before Ayilavarapu took charge, ICICI Direct said the Reliance Retail Ventures' subsidiary was dealing with "weak core growth and monetisation challenges."

"Just Dial's core business continues to exhibit muted growth, with revenue rising only ~0.5% quarter-on-quarter and 6% year-on-year while paid campaign additions [remain] largely stagnant… reflecting limited traction in SME demand,” the report added. "Flat ARPU at ~ ₹4,825 further indicates weak pricing power despite platform scale. Additionally, declining traffic (unique visitors down 1.2% QoQ and 4.7% YoY) trends signal weakening user engagement.”

In July, the appointment of Ayilavarapu as CEO, succeeding founder V.S.S. Mani, briefly boosted the stock. Analysts tracking the company retained their ‘Buy’ ratings and raised their price targets.

Bigger ambitions

Now, Just Dial aims to target verticals where competition is limited or non-existent, in a bid to revive collections. Ayilavarapu cited examples of specialized merchant categories such as solar panel installers, tow truck services, pest control, and packers and movers as key growth drivers for the horizontal directory.

"Our advantage is that we actively 'pound the pavement' to aggregate rich merchant data on the ground," Ayilavarapu said. "Integrations with platforms like OpenAI make our aggregated data accessible wherever consumers spend time."

In the quarter ended September, Just Dial reported a 4.7% sequential and 13.1% year-on-year revenue growth. It had current assets worth ₹6,195 crore, most of which were tied up in investments worth ₹5,414 crore.

On capital allocation and its alignment with the broader Reliance Group, Ayilavarapu said Just Dial operates under the board's oversight within Reliance Retail. He said that his mandate for the company's cash balance is to deploy capital to drive revenue expansion while widening the merchant network.

"The vision is to be India's largest, stickiest, highest engagement network of merchants," Ayilavarapu said. "My mandate regarding cash balance and strategy is to drive growth and drive it accretively."