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Jubilant Foods: CMP: 687 Long term Gr: 14% | Q1_FY_25 Gr: 45%
(Q1_Fy_25 the demand in LFL growth was back after the long muted phase of 8 quarters)
About Jubilant FoodWorks Limited:
Jubilant FoodWorks Limited is India’s largest foodservice company and is part of the Jubilant Bhartia Group. Incorporated in 1995, the Company holds the exclusive master franchise rights from Domino’s Pizza Inc. to develop and operate the Domino’s Pizza brand in India, Sri Lanka, Bangladesh and Nepal. In India, it has a strong and extensive network of 2096 Domino’s+other brand restaurants across 421 cities. In Sri Lanka and Bangladesh, the Company operates through its 100% owned subsidiary which currently has 50 and 28 restaurants respectively. The Company also has exclusive rights to develop and operate Dunkin’ restaurants in India and Popeyes restaurants in India, Bangladesh, Nepal and Bhutan. The Company currently operates 31 Dunkin’ restaurants across six Indian cities and 42 Popeyes restaurants in two cities. In 2019, Jubilant FoodWorks launched its first owned-restaurant brand ‘Hong’s Kitchen’ in the Chinese cuisine segment which now has 28 restaurants across 3 cities. On 19 February 2021, the company announced that it would acquire complete ownership of Netherlands-based Fides Food Systems & owned 53.5% initialy and now its 90% ownership of DP Eurasia NV.
Growth Story: Company was able to increase its sales from 74 Cr during the year 2004 while during the IPO in 2010 they reached 424 Cr sales and 33 Cr of Profits from 300 restaurants. We have been recommending this company since IPO. Adjusting the split and bonus the Company got listed during IPO at Rs 16. We have seen strong growth since then as they reached the total number of restaurants at 2991 last year with sales reaching 5654 Cr and profits 400 Cr. This shows the growth of 20X in Restaurant opening and 30X in Sales. Hence if invested during the IPO today even valuations are 35X along with consistent dividends as the company never made the losses since listing even during the tough year of Covid followed by Inflation.
📈 Jubilant FoodWorks Limited Q1 FY25 Financial Performance Overview
🏢 1. Store Growth
New Store Openings:
India: +52 net stores, with Domino's India opening 34 new stores.
International: +14 net stores across all markets.
📊 2. Sales Growth
Group Sales: ₹22,365 million (+44.8% YoY).
Domino's India: Revenue at ₹14,396 million (+9.9% YoY).
Like-for-Like (LFL) Growth: 3.0%
Delivery LFL Growth: 12.1%
💰 3. Profit Growth
EBITDA: ₹3,831 million (+38.9% YoY), with a margin of 19.8%.
Profit After Tax (PAT): ₹608 million (+110.3% YoY).
🌍 4. Regional Growth
India: Strong performance with 9.9% YoY revenue growth.
Turkey and Surrounding Regions: Domino's Turkey achieved 10.3% LFL growth.
📦 5. Segmental Growth
Domino’s India: Revenue from operations: ₹14,396 million.
Emerging Brands: COFFY Turkey and Popeyes India continue to grow, with COFFY reaching 100 stores and Popeyes reaching 50 stores in India.
📉 6. Margins
Gross Margin: 72.6%, slightly lower than last year.
EBITDA Margin: 19.8%, with a slight decrease from previous quarters.
🚀 7. Future Expansion and Outlook
Expansion: Continued focus on expanding the store network, introducing new products, and enhancing digital engagement.
🏪 8. Same Store Growth
Domino's India: LFL growth of 3.0%, with delivery LFL at 12.1%.
This year again we may see sales growth back on the front foot.
Hence, New buying again can be done during any fall near 425 all with this year's target of 876 where we may book some 5% profits. Strong recovery expected this year. SIP could be done even in current challenging scenarios.
Global Consumer Foodservice Market is Rs 208 Lakh Cr. At 4 Lakh Cr, India is currently the 9th largest market. China's Food market is 13X then India even though the Population size is same. Quick Service Restaurants which is currenly 40000 Cr India could grow by 14% CAGR next Decade considering increasing GDP/Capita, Increasing Urbanisation & Young India. Jubilant foods which is with the highest market share could cash this growth. Medium term growth of restaurants is visible towards 5500 from currently 2900.
Yes, Jubilant is the largest restaurant chain operation in India with the highest number of restaurants and are best managed as we never saw losses in the past 18 years v/s other restaurants making frequent losses. We may see them grow again once cost to run gets easier and our estimates should be around 14% growth for this decade. We may see them reach around 15000 Cr sales till the fy_2031. Yes, this could be a long term wealth creator where consistent profits could be expected.
Today around 21% holding is with MF, Insurance Companies or AIF. Even FPI holds around 27% stake.
DISCLOSURE: FOR EDUCATION PURPOSES, DO NOT TREAT AS A RECOMMENDATION
