Motilal Oswal's research report on Barbeque Nation Hospitality
Barbeque Nation Hospitality’s (BBQN) consolidated revenue was flat YoY at INR3.3b (miss), impacted by competition in South India and sluggish demand. The Same-Store Sales Growth (SSSG) remained weak and reported -2% YoY in 3QFY25 despite a favorable base of -4.9% in 3QFY24 (- 2.5% in 2QFY25). Dine-in revenue declined 2% YoY to INR2.8b, while delivery was up 7% to INR0.5m. BBQ India’s revenue fell 4% YoY to INR2.6b and same store sales were down by 2.6%. The company maintained a GP margin of 66.7%, supported by cost-control measures, which helped maintain the Restaurant Operating Margin (RoM) (Pre-Ind AS) at 14.9%, despite operational leverage pressure.
Outlook
BBQN’s current valuations are at 11.9x FY25E and 9.6x FY26E pre-Ind AS EV/EBITDA. We reiterate our Neutral rating on the stock with a TP of INR350, based on 10x Dec’26E Pre Ind-AS EV/EBITDA.
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