Motilal Oswal's research report on Jubilant FoodWorks
JUBI’s 1QFY23 result was broadly in line with our estimates on all fronts. With 58 stores added in 1Q, the management is well on track to meet its 250 store opening guidance for FY23. Delivery sales continued to deliver healthy growth, despite a higher base, with dine-in reviving to nearly 100% of pre-COVID levels. The management stated that price increases taken in 3QFY22 and subsequently in 1QFY23 are enough to combat input cost inflation. With its remarkable track record, strong moats built around delivery, technology, value, and healthy cash flows to finance store expansion, JUBI remains our top pick in the QSR space. We maintain our Buy rating.
We maintain our Buy rating with a TP of INR720 per share (40x Jun’24 pre-Ind AS 116 EV/EBITDA). Premium multiples are assigned for the best-of-breed operating and financial metrics in a high-growth category.
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