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HDFC Securities: Jubilant FoodWorks Q2 Results Review - Recovery Continues; Priced-In

HDFC Securities: Jubilant FoodWorks Q2 Results Review - Recovery Continues; Priced-In

A file photograph of  a Domino’s Pizza outlet operated by Jubilant Foodworks Ltd. in Amritsar, India. (Photographer: Brent Lewin/Bloomberg)
A file photograph of a Domino’s Pizza outlet operated by Jubilant Foodworks Ltd. in Amritsar, India. (Photographer: Brent Lewin/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

HDFC Securities Report

Jubilant reported mixed Q2 with a marginal miss in revenue and beat in the margin.

Revenue/EBITDA was up -19/-9% YoY vs. the expectation of -17/-18%.

SSG was at -20% (HSIE -15%), while LFL was at -13% if we remove the store closure impact. Sequential growth was healthy (much better than peers), as system sales recovered to 85/92/96% of last year in Aug/Sep/Oct.

Recovery has been driven by strong growth in delivery and takeaway channels, as dine-in has continued to remain under pressure. Delivery charges, along with benign raw material, were partially compensated by EDV offers; still, gross margin expanded by 350/80bps YoY/QoQ to 79%. Ebitda margin expanded by 286bps YoY.

We slightly increase EPS for FY21/22/23 to reflect better margin.

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HDFC Securities - Jubilant FoodWorks.pdf

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