Jubilant Foodworks Ltd. share price target

JFL reported robust growth of 26% YoY in top line in Q1FY19, driven by higher than anticipated SSG which grew at a staggering pace of 25.9% YoY (6.5% SSG in Q1FY18). Superior product, continued strong response to Everyday value offer coupled with aggressive marketing (IPL T20) drove SSG higher in the quarter. Further, online sales remained strong with share of online orders (OLO) increasing to 65% of the delivery sales as against 51% in Q1FY18. JFL is also working towards increasing the funnel of new locations and has doubled the number of store openings as compared to the last quarter, adding 13 new Domino's stores (closed 3 stores) taking the total store count to...

Revenue increased by 9.65% to Rs. 855.06 Cr in Q1FY19 when compared to the previous quarter. Jubilant Foodworks Ltd Q1FY19 results Comment

We value it at 46x P/E on Jun-20EPS to arrive TP of Rs 1,562 (earlier Rs 1510). We maintain BUY. Jubilant FoodWorks (JFL) reported another blowout quarter with revenue growth of 26% to Rs 8.55bn (exp. of 20%) led by SSG of 26% (6.5% in 1QFY18) vs. expectation of 18%. JFLs IPL activations (higher ad spend) with EDV offer aided in driving volume led growth. The franchise enjoys high operating leverage resulting in EBITDA margin expansion of 489bps YoY to 16.6% (exp. 15.5%). EBITDA/APAT growth was stellar at 79/151% (exp. 59/99%).

JFL's Q1FY19 results beat our estimate with strong 25.9% Same Store Sales (SSSG) performance. After lackluster EBITDA outlook in 19 consecutive quarters (17.4% in Q3FY13 to 9.9% in Q4FY17), for the third consecutive quarter, the company exhibited striking operating performance with 490 bps margin expansion to 16.6%. Continuing momentum in core pizza due to product upgrade and Everyday Value Offer'(EDV) is driving growth. Further, better IPL season was a key driver of the growth. GST has been a boon for the company to increase profitability. Going ahead, we...

Jubilant Foodworks Ltd is in the FMCG sector, having a market capitalization of Rs. 16,928 croreswhich holds themaster franchiseforDomino's...

Revenue decreased by 1.93% to Rs. 779.82 Cr in Q4FY18 when compared to the previous quarter. Jubilant Foodworks Ltd - results Comment

We value it at 46x P/E on Mar-20EPS to arrive TP of Rs 2,846. We maintain BUY. Jubilant FoodWorks (JFL) posted revenue growth of 27.3% to Rs 7.79bn vs. expectation of 25%. Revenue beat was on account of higher SSG of 26.5% (-7.5% in 4QFY17) vs. expectation of 22% but lower store expansion. EBITDA margin continued its expansion by 650bps YoY to 16.4%. EBITDA/APAT growth was stellar at 111/234% vs. expectation of 111/198%.

JUBI's sales grew 27.3% YoY to INR7.8b (est. of INR7.5b), with SSS growth of 26.5% YoY (est. of +20%). With net seven stores added in 4QFY18, the total store count stood at 1,134 as of end-FY18. Gross margin contracted 260bp YoY to 74.3%, while EBITDA margin expanded 650bp YoY to 16.4%. EBITDA, thus, grew 111.1% YoY to INR1.3b (in-line), while adj. PAT increased 355.8% YoY to INR681m (est. of INR617m). FY18 performance: SSS growth stood at 13.9% YoY. Standalone net sales, EBITDA and adj. PAT increased 17.1%, 81% YoY and 173.5%, respectively.

Domino's extends Everyday value offer (EDVO) to regular sized pizza's starting at Rs 99 each. This is an extension of the EDVO launched on the medium sized pizza last year. The EDVO overlaps existing Pizza Mania offering at lower price point but extends the discount to more offerings in the regular size category. The offer also targets small groups and increases affordability which should help sustain the SSG improvement. Management initiatives continue to increase SSG and margins visibility. Acceleration in store expansion, improvement in mobile ordering app and dining experience could be additional growth drivers in future....

Above estimates: Net sales, EBITDA and adj. PAT were well above estimates, driven by 17.8% SSSg at Domino's (highest in five years). Gross margin declined 40 bps YoY (product enhancement only partially offset by lower discounts)