Mar 20, 2017 04:07 PM IST | Source: Moneycontrol.com

Hold Jubilant Foodworks; target of Rs 950: Axis Direct

Axis Direct recommended hold rating on Jubilant Foodworks with a target price of Rs 950 in its research report dated March 17, 2017.

Hold Jubilant Foodworks; target of Rs 950: Axis Direct

Axis Direct's research report on Jubilant Foodworks

Mr. Pratik Potais joining Jubilant as CEO in the midst of challenging times. After a blockbuster performance over FY10-13, Jubilant has posted low single-digit SSSg for the fourth consecutive year. Low SSSg and rapid store expansion led to a dramatic fall in OPM (from 17.4% in FY13 to 10.1% in FY17E), resulting in EPS decline of 17% over FY12-17E and RoE coming down to 11%.

Outlook

A turnaround will not be easy to come by and we await strategic clarity from new management. Maintain HOLD with TP of Rs 950 (40x fwd PE).

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