Brokerages slash target price on Jubilant FoodWorks despite seven-fold jump in net profit

Jubilant FoodWorks shares have traded sideways over the past year, recording gains just under one percent.

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26 Aug, 2025 12:21

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Brokerages were left unimpressed with Dominoes-operator Jubilant FoodWorks' quarterly show, leading to target prices being cut.

Jubilant FoodWorks reported a consolidated net profit of Rs 208.2 crore for the March quarter, seven times more than Rs 28.5 crore in the year-ago period. The company has reported an exceptional gain of Rs 170 crore.

The Domino's Pizza operator's revenue came in at Rs 1,572.7 crore, a 23.8 percent rise from Rs 1,269.8 crore in the year-ago quarter, the company said. The EBITDA margin dipped 210 bps on-year to 6.9 percent.

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For Jubilant's valuations to improve further, Nuvama Institutional Equities said same-store sales growth would have to revive, which remains a challenge.

"Jubilant has taken multiple initiatives— loyalty, reducing delivery time, brand rehaul with IHOP, improvement in delivery or order growth — which are positive, but not enough," said the brokerage. It kept its hold rating intact, slashing its target price from Rs 498 to Rs 487 per share.

Morgan Stanley retained its equal-weight call on Jubilant FoodWorks, cutting its target price to Rs 427 per share, as Q4 earnings missed its expectations on weaker margins. This implies a downside of around 11 percent.

The brokerage added that the current operating deleverage cycle has resulted in significant cuts to estimates, while the improved underlying demand remains key to any further recovery.

International brokerage Jefferies also cut its target price on Jubilant FoodWorks to Rs 475 apiece, as margins contracted to multi-quarter lows.

Jubilant FoodWorks shares have traded sideways over the past year, recording gains of just under one percent. In comparison, the frontline Nifty 50 index has risen around 23 percent during the same time period.

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