In an interview to CNBC-TV18, Ajay Kaul, CEO of Jubilant Foodworks spoke about the results and his outlook for the company.
Despite a dismal performance in the first quarter of FY17 where its same-store sales growth went into the negative territory for the first time in past seven quarters, Jubilant FoodWorks is confident of an improved show and a positive same-store sales growth in the second quarter.
Goldman Sachs says that management's lower store opening guidance will hurt growth. It expects only a small uptick of SSSG to 4 percent in FY17 from 3 percent in FY16 adding that fewer store openings should have a positive impact on SSSG but it remains cautious this time.
The stock market is unlikely to witness too many earnings downgrades from hereon as it is going into the second quarter earnings with muted expectations, says Manish Gunwani, senior fund manager with ICICI Prudential Asset Management Company.
Lohchab is of the view that advertising and promotional spends will continue to rise due to increasing competition and lower demand.
Analysts polled by CNBC-TV18 expect same-store-sales-growth (SSSG)of 6-8 percent in Q1. Gross margins are likely to reflect advantage of soft commodity prices but store addition costs may partially weigh down on margins. Rent is likely to remain steady without significant hikes while higher tax burden may impact bottom line.
The management expects SSSG to rise to low double digits by end-FY16 driven by better consumer sentiment and lesser store splits, while Goldman Sachs sees 530 bps lower network growth in FY17 versus FY15.
Net sales may grow 27 percent to Rs 490 crore on account of around 6 percent growth in same-store-sales (SSS) and nearly 20 percent growth in store expansion.
The Domino's Pizza and Dunkin' Donuts restaurant chain operator's same-store sales grew just over 6 percent in April-June, sharply lower than the 22.3 percent growth in the year ago quarter and Ravi Gupta, CFO, says the company is taking taking steps to encourage consumption.
Credit Suisse has an "underperform" rating on Jubilant Foodworks and sees downside risks to the Domino's Pizza and Dunkin' Donuts restaurant chain operator's same-store sales guidance of 8-10 percent.
Jubilant Foodworks plans to spend Rs 75 crore on four new commissaries in FY14, its CEO Ajay Kaul said on Friday. He says consumers are downtrading and cutting back on spends amid the economic slowdown, but is confident of double-digit growth, once the economy recovers.