Jubiliant FoodWorks - Growth Vectors In Place; Eating Out Frequency Rising: Centrum Broking

Operational excellence to innovate and drive consumer experience.

<div class="paragraphs"><p>Domino's pizza in a box. (Source: Aopollo/Unsplash)</p></div>
Domino's pizza in a box. (Source: Aopollo/Unsplash)

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Centrum Broking Report

Our recent interaction with Jubilant FoodWorks Ltd.’s management indicated growth vectors are in place which are led by,

  1. rising eating out frequency,

  2. reimaging of stores saw high single digit like-for-like growth,

  3. focus on access and reach driving dine-in, and

  4. operational excellence.

Jubilant FoodWorks’ management identified three key priorities, Domino’s, Popeyes and cultural shift to determine future growth, while menu changes in Hong’s Kitchen appears to be promising.

More importantly, focus on Coffee-first initiative improved profitability for Dunkin’s.

With upcoming commissaries in Bengaluru and in Maharashtra expect to influence margin trajectory in our view.

Though it’s early, rising eating out frequency could lift dine-in as well as ordering in our view. That said, such trends coupled with focus on driving consumer experience (cheesy rewards, 20-minutes delivery) could show up in LFL growth.

We tweaked our earnings and retain 'Buy' with a revised discounted cash flow-based target price Rs 612 (implying 21.2 times FY25E earnings per share).

Click on the attachment to read the full report:

Centrum Jubiliant Foodworks - Company Update.pdf
Jubilant FoodWorks - Demand Weakness Persists; Strengthening Core: HDFC Securities


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