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Buy Jubilant FoodWorks: Target Of Rs 2799: Sharekhan

Sharekhan is bullish on Jubilant FoodWorks recommended buy rating on the stock with a target price of Rs 2799 in its research report dated November 12, 2020.

Nov 15, 2020 / 11:30 AM IST
 
 
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Sharekhan's research repor on Jubilant FoodWorks


Jubilant Foodworks Limited’s (JFL) revenue decreased by ~19% to Rs. 805 crore in Q2FY2021; Delivery channel’s revenue grew by 5.8% and takeaway channel grew by ~50%. Benign input prices, delivery charges of Rs. 30 per order, and reduction in wastage aided gross margins to improve by 352 bps to ~79%; Gross margin trajectory is likely to be 76-77% in the coming years compared to 74-75% earlier. As part of its cost-saving strategy, the company has shut down 105 non-profitable outlets in H1FY2021, which will not have any major impact on revenue as a large number outlets are dine-in outlets (will add 100 new stores in FY2021 with re-modelled store format). Rising trend of digital ordering and shift to top brands will help JFL to post better performance in the quarter ahead.


Outlook


We recommend Buy with price target (PT) of Rs. 2,799.


For all recommendations report, click here


Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Nov 15, 2020 11:30 am

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