Jubilant Foodworks Ltd. share price target

Jubilant Foodworks (JUBI) has reported below than expected revenue for Q1FY21 while net loss came-in lower than our estimates. National lock-down and local restrictions have fueled overall decline in revenue. However, with gradual opening of stores, overall business recovered to 53% compared to last year during 1QFY21. Delivery part of business recovered faster (at 77%) compared to takeaways (at 55%) and dine-in (at 3%). Positively, the month of Jul'20 and Aug'20 witnessed strong growth in all three channels; takeaways grew faster than delivery and dine-in. Overall business at the exit of Aug'20 stood at 89% of last year supported by brilliant execution. JUBI...

2 September 2020 Jubilant FoodWorks (JUBI)s 1QFY21 results were weaker than expected, especially in terms of operating margins. Depreciation and interest costs were also higher than anticipated. Three events underpin higher growth and profitability for JUBI beyond the (2) the introduction of delivery charge; and (3) opportunity created by the crisis to close down 105 of its least profitable (and dine-in dependent) stores. This would lead to all-time high EBITDA margins in FY22, resulting in 33% upward revision in our EPS projections for FY22. Maintain Like-for-like (LFL) growth stood at -61.5% (this refers to YoY growth in sales for non-split restaurants opened before the previous FY). LFL growth, excluding the restaurants temporarily closed due to COVID-19, stood at - 47.3%. 24 new Dominos Pizza stores were launched (net addition of 19 stores) and four stores for Dunkin Donuts were closed down in 1QFY21. Gross margins were up by 260bp YoY to 78%.

Though the lock down impacted performance significantly during Q1, the company was able to recover 69.8/84.6% of the sales during July/August'20. We believe that the delivery business would gain higher traction compared to dine in in the near term. The company has introduced delivery charges which is likely to mitigate impact of increased discounts and help improve margins. JFL would close down 105 Domino stores which are not profitable...

We are cutting FY21 estimates by 23% but increase FY22 and FY23 EPS by 15.2% and 25.2% and assign Hold rating to the stock. Dominos is on a path of recovery and is likely to emerge stronger from Covid 19 scenario given that 1) Sharp recovery in delivery and takeaway in July and August (110% and...

In its Annual report FY20, Jubilant Foods (JFL) continues to emphasize its 5-pillar growth strategy 1) fortress Domino's in India, 2) elevate customer experience 3) sustained technology investments 4) build portfolio of brands 5) focus on international. With a robust business model, efficient supply chain, large network, strong reputation for quality, hygiene and...

Given near-term challenges amidst COVID-19 situation, we cut our estimates and downgrade our rating on the stock to a ACCUMULATE, with a revised target price of Rs. 1,903 based on 55x FY22E adj. EPS. Nation-wide lockdown impacts operations JFL reported muted growth in revenue of 3.8% YoY to Rs. 898cr for Q4FY20, mainly impacted by nation-wide lockdown since March amidst COVID-19 pandemic. Company witnessed strong revenue growth during the first two months with LFL/SSG growth at 8.4%/7.2% in Jan and 14.9%/13.1% in Feb. However, LFL/SSG growth fell sharply in...

Jubilant Foodworks (JUBI) has reported below expected result for Q4FY20. Revenue came in line with our estimates but higher expenses and exceptional losses led to negative surprise on PAT. During first two months of the quarter, JUBI reported strong recovery in SSSG. However, in the month of March (only 10 days lock-down), decline in SSSG has been steep. JUBI has now opened 70% of their stores and aims to open other 30% by the mid June'20. Positively, JUBI is likely to soon launch Zero Contact Takeaways which is likely to offset business lost in dine-in (this earlier contributed 3540% of revenue). Also, due to COVID19 QSRs which are based on open-kitchen concept will gain market share from un-unorganized restaurants as customers will give more...

20 May 2020 While 4QFY20 sales were in line with expectations, EBITDA and PAT were significantly below expectations. Extended lockdown, the economic implications of COVID-19 on discretionary consumption, a minimum wage increase, and 30% of sales generated from dine-ins were major concerns that more than offset market share gains in other restaurants and aggregators. Downgrade to year growth in sales of non-split restaurants opened before the previous financial year) stood at -2.3%. This led to EBITDA margin expansion of 180bp to 18.9%. EBITDA for 4QFY20 (without the impact of Ind-AS 116) declined 59.8% YoY to INR593m, with the EBITDA margin at 6.6%. The company reported an exceptional item of INR323m pertaining to a) provision for diminution in the value of the investment of INR200m in the Sri Lankan subsidiary and (b) COVID-19-led expenses of INR123m.

We recommend a SELL on JUBILANT FOODWORKS with a Target Price of Rs 1,408 a downside of 7% from CMP of Rs 1,515 and Stop Loss Rs 1,568.