Shares of Jubilant FoodWorks surged 5 percent to Rs 670 on August 12 after the company’s first-quarter performance outpaced market expectations. Demand was fuelled by the introduction of lower-priced menu options and the lure of free deliveries. Despite the beat, brokerages remained cautious, warning that a high base could make it challenging to sustain double-digit revenue growth in the coming quarters.
Avendus reduced its target price for Jubilant FoodWorks to Rs 700 from Rs 735 while retaining an “Add” rating. The brokerage highlighted that the elevated base poses a risk to maintaining high double-digit revenue growth.
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It noted that operating leverage is yet to fully kick in, with margin expansion likely to be back-ended. For FY26–27E, revenue growth is projected to stay in the low-teens, while a margin expansion of approximately 200 basis points is expected later in the forecast period. However, margin estimates for FY26–27E were trimmed by 50–60 basis points.
Motilal Oswal Financial Services (MOSL) also cut its target price, revising it to Rs 725 from Rs 750, and maintained a “Neutral” stance. The brokerage noted steady performance with no major changes to FY26/27 EBITDA estimates.
It expects the delivery segment to outperform in the near term and sees value offerings along with product innovation driving order growth in FY26. Standalone pre-IND AS EBITDA margin is projected at 12–14 percent for FY26–28E. MOSL added that rich valuations support its decision to keep the rating at Neutral.
The broader context shows that urban Indian consumers are tightening their belts amid rising living costs, weighing on same-store sales for budget retailers like Trent and quick-service restaurant chains such as Pizza Hut operators Sapphire India and Devyani International. Jubilant FoodWorks, however, has stood out as an exception, delivering double-digit like-for-like sales growth for at least three consecutive quarters.
For the quarter ended June, Domino’s India – operated by Jubilant – posted an 11.6 percent growth in like-for-like sales, led by a strong 20.1 percent surge in the delivery segment. In contrast, Sapphire India saw an eight percent drop in Pizza Hut’s same-store sales, while Devyani International reported a 4.2 percent decline.
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