Westlife Foodworld Ltd. share price target

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...

Convenience platforms help stage smart recovery

Amid the rising second wave of COVID cases, Maharashtra has imposed stringent restrictions from 5th to 30th Apr'21. Accordingly, restaurant players have been directed to stop dine-ins, though deliveries are permitted 24x7....

Westlife Development's (WDL) Q3FY21 revenue was ~25% YoY lower than est., due to closure of 10 restaurants during the quarter (nine restaurants closed in Q2FY21).

Westlife Development (WDL) operates McDonald's restaurants in West and South India through a master franchisee arrangement with McDonald's Corporation.

India) to get an idea of current demand trends and impact of increasing competition and cloud kitchens on its growth plans. WLDL remains positive on its demand positioning given 1) value offerings in Menu 2) McCafe scale up 3) EOTF stores and 4) rising traction of Mcdelivery. Although rising penetration of cloud kitchens and food delivery options can impact delivery based formats, their focus on dine in sales insulates them significantly. We are positive on WLDL as strategies like 1) brand extension through McCaf 2) continuous menu innovations and 3) new age stores to improve...