Westlife Foodworld Ltd. share price target

Westlife of today is a result of great execution (a real turnaround when compared to say ~8 years back). WLDL was not in the top-tier of ‘great executor’ back then. The journey has been long and it’s all adding up now.

We initiate with a BUY rating and value the company based upon EV/EBITDA. We ascribe 30x FY24e EV/EBITDA to arrive at 1 year forward TP of Rs 625/share, implying an upside potential of 30% from the CMP

Westlife Development's (WDL) Q2FY22 performance was better than expected on all fronts.

WLDL once again delivered a better than expected SSSG and sales growth, led by continued strong momentum in the convenience platform. The convenience channels continue to remain elevated, despite a recovery in dine-in, which almost doubled YoY. Inflationary pressures on commodities led to gross and EBITDA margin being slightly lower than expected. The continued sales momentum would drive operational leverage on margin in the future. With the opportunity for organized QSRs significantly improving after the...

We are cutting FY23 EPS by 9.8/10.7% and rating to Accumulate although we factor in sustained post covid recovery led by gradual pick up in dine in and continued traction in convenience channel. Although second covid wave halted the recovery witnessed during 2H21 but Sep-21 numbers offer renewed confidence with Gross margins of 67% and EBITDA margins of 16.4%....

WLDL delivered better than expected SSSG and sales growth, led by continued strong momentum in the convenience platform, while dine-in was affected by COVID-related restrictions. As these restrictions are being lifted, WLDL would see much better sales performance going forward. This is because the convenience channel continues to remain elevated, despite a recovery in dine-in, as per recent trends. This bodes well for both sales per store and margin performance. While gross margin was higher than expected, EBITDA margin was slightly...

Store opening guidance turns aggressive

We are increasing FY23 EPS by 13.1% on the back of increased AUV expectations of Rs60-65mn led by convenience channel and incremental AUV from fried chicken. Strong growth across convenience channel despite pick up in Dine-in will drive operating leverage and improve profitability, provided...

Westlife Development (WLDL) delivered in-line SSSG, but lower-thanexpected sales growth, with just one new store addition in 4QFY21 and only five in FY21. Furthermore, the dine-in channel (45% of sales in 4QFY21) was still below normal levels. However, strong performance from the convenience channel is a positive. Gross margin (GM) expansion through volume recovery, channel optimization, and supply chain initiatives is encouraging. The recovery in McCaf would further support the GM. EBITDA margins were below expectations, with a one-time employee bonus and salary reversals putting...