Jubilant FoodWorks Ltd.’s profit for the quarter ended December more than tripled fuelled by healthy same-store sales growth of Domino’s Pizza chain.
Net profit rose to Rs 66 crore from 20 crore in the same quarter last year, the company which Domino’s Pizza and Dunkin’ Donuts chains in India said in an exchange filing today. That’s higher than Rs 44 crore profit estimate of analysts tracked by Bloomberg. The top line increased 20.8 percent to Rs 795 crore from the year-ago period.
The same-store sales in the Domino’s pizza chain grew 17.8 percent in the third quarter from 5.5 percent in the three months ended September.
“The lowering in rate of applicable GST to 5 percent has allowed us to demonstrate our commitment to deliver the best value proposition as we passed on the benefits of lower tax rate to the customers,” Chairman Shyam Bhatia said in a separate press release. The GST Council in its Nov 10 meeting reduced the tax rate on all restaurants to 5 percent without input tax credit from 18 percent earlier.
Jubilant FoodWorks continued to reduce its losses from Dunkin’ Donuts outlets, with greater focus on donuts and beverages and closure of unprofitable stores, the press release added.
Operating income of the Noida-based company surged 115 percent to Rs 136 crore, while the margin expanded to 17.1 percent from 9.6 percent last year.
Earlier this week, Morgan Stanley labelled Jubilant Foodworks as its top pick in the fast-moving consumer goods segment, replacing Titan Company Ltd., owing to an anticipated uptick in sales and margin. Jefferies also initiated coverage on the stock with a ‘Buy’ rating.