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What should investors do with Jubilant FoodWorks stock post Q3: buy, sell or hold?

Standalone revenue from operations growth of 14.1 percent year-on-year at Rs 1,059.6 crore.

January 30, 2020 / 12:03 PM IST
 
 
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Jubilant FoodWorks share price added over 2 percent in early trade on January 30 after the company reported its December quarter results.

The company's standalone profit grew 7.5 percent year-on-year at Rs 103.7 crore from Rs 96.5 crore in the same period last year. Meanwhile, standalone revenue from operations grew 14.1 percent YoY to Rs 1,059.6 crore.

Domino's same-store-sales growth stood at 5.9 percent for the quarter, largely in line with street estimates of 5-7 percent.

Also Read - Jubilant Foodworks Q3 profit rises 7.5%, misses estimates; same-store-sales growth at 5.9%

Citi | Rating: Buy | Target: Raised to Rs 2,020 from Rs 1,655 per share

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The company's Q3 profit missed the estimates, but the mid-term story remains intact. It is well placed in the attractive Indian food services business.

Proven strategies & good execution track record are the positives, while any weakness in the stock may be an enhanced buying opportunity.

The research house raised revenues but lowered EPS estimates by 3-7 percent post-earnings.

Kotak Institutional Equities | Rating: Downgrade to add from buy | Target: Raised to Rs 1,900 from Rs 1,600 per share

The 5.9 percent same-store-sales growth is healthy in the backdrop of the wider macro slowdown. However, the step-up in store expansion pace reflects the company's confidence in demand.

The research houses like the company as a structural play on high-growth organised QSR opportunity.

Credit Suisse | Rating: Underperform | Target: Raised to Rs 1,460 from Rs 1,300 per share

Credit Suisse remained cautious at current valuations as the demand environment remains challenging. The food aggregators could see a return of aggressiveness if they raise funds.

Morgan Stanley | Rating: Overweight | Target: Rs 1,900 per share

The continuing focus on cost rationalisation helped the company to mitigate input cost pressures. The improvement in SSSg & step-up in store expansion drives confidence.

MS lowered FY20-FY22 earnings estimates by 4 percent and likes the strategy of focusing on accelerating same-store sales growth.

At 09:19 hrs, Jubilant Foodworks was quoting at Rs 1,781.75, up Rs 37.00, or 2.12 percent on the BSE.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Moneycontrol News
first published: Jan 30, 2020 09:35 am

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