Sharekhan's research report on Jubilant Foodworks
Jubilant Foodworks (JFL), through the recently-formed subsidiary in Netherlands, acquired a 32.8% stake in DP Eurasia NV, the exclusive franchisee of Domino’s Pizza brand in Turkey, Russia, Azerbaijan and Georgia. JFL to pay Rs. 250 crore for 32.8% in DP Eurasia; deal valued at 0.5x its CY2020 sales of Rs. 1,635 crore; DP Eurasia operates the Domino’s brand in four countries through 770 stores (Delivery to Dine-in mix 75:25). JFL’s domestic business hit pre-COVID levels in Q3; but recent rise in COVID cases remains a key risk to sales in the near term.
Outlook
New ventures such as entering into Chinese cuisine and Biryani segments and strategic stake buy augur well for long term; maintain Buy with revised PT of Rs. 3,380.
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