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Buy Restaurant Brands Asia; target of Rs 150 : Motilal Oswal

Motilal Oswal is bullish on Restaurant Brands Asia recommended buy rating on the stock with a target price of Rs 150 in its research report dated March 29, 2022.

March 30, 2022 / 02:34 PM IST

"India’s specialty chemicals industry is a decadal growth opportunity and it is still not too late to participate in the value creation process. We prefer CRAMS/CSM players Navin Fluorine (Navin) and PI Industries (PI) as they provide long-term earnings visibility. We also like UPL due to robust growth outlook and reducing debt concerns and SRF due to rising contribution from the chemicals business," JM Financial research report.

 
 
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Motilal Oswal's research report on Restaurant Brands Asia

As highlighted in our QSR thematic note published in Dec’21, COVID-19 has augmented the business opportunities for QSRs resulting in an optimistic outlook for all branded QSR players. Both delivery and takeaway channels were in focus over the last two years as the consumers developed new habits of food consumption. Even as dine-in revives, the contribution of delivery would be elevated than pre-COVID levels. COVID has, therefore, permanently shifted the QSR business model towards an omni-channel play. Restaurant Brands Asia (RBA; previously BURGERKI), being a prominent QSR player in India, is also expected to benefit from this shift. We maintain our positive view on RBA underpinned by the following factors:

Outlook

With RBA’s current multiples being cheaper than peers, we reiterate our BUY rating with a TP of INR150 (based on SOTP 36x/12x FY24E EV/EBITDA* for India/Indonesia, respectively). *pre-IND AS 116.