Motilal Oswal's research report on Westlife Foodworld
Westlife Foodworld (WLDL) reported an in-line operating performance in 1QFY24, supported by strong 7% SSSG and 9% store adds. EBITDA/PAT growth of 19%/22% YoY was driven by stable input costs and operating efficiency. The management anticipates high single-digit SSSG and the addition of 40- 45 new restaurants in FY24. Easing commodity pressures and the company’s focus on growing average unit volume are the key positive factors, which could be partly offset by an increase in royalty. We reiterate our Neutral rating on the stock.
Outlook
Our valuation at 28x pre-Ind AS FY25E EV/EBITDA leads to a TP of INR820. Easing commodity pressure and the company’s focus on growing its average unit volume are the key positive factors. These factors could be partly offset by an increase in royalty. We reiterate our Neutral rating on the stock.
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