Dolat Capital's research report on Jubilant FoodWorks
JFL’s Q1FY19 results beat our estimate with strong 25.9% Same Store Sales (SSSG) performance. After lackluster EBITDA outlook in 19 consecutive quarters (17.4% in Q3FY13 to 9.9% in Q4FY17), for the third consecutive quarter, the company exhibited striking operating performance with 490 bps margin expansion to 16.6%. Continuing momentum in core pizza due to product upgrade and ‘Everyday Value Offer’(EDV) is driving growth.
Outlook
We expect the company to report similar results in Q2FY19E, but then after it would have to fight against unfavorable base. Maintain Accumulate with a TP of ` 1,495 (35x FY20E CEPS).
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