Jubilant FoodWorks Hits Record High on Strong Sales Recovery in June Quarter - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  
  • Home
  • Views On News
  • Jul 22, 2021 - Jubilant FoodWorks Hits Record High on Strong Sales Recovery in June Quarter

Jubilant FoodWorks Hits Record High on Strong Sales Recovery in June Quarter

Jul 22, 2021

Quick service restaurants major Jubilant FoodWorks reported Rs 623 m net profit for the April-June quarter. The firm had posted Rs 726 m net loss in the same quarter last year.

The company's performance came in the face of a second wave of the Covid-19 pandemic, which impacted its store openings across the country.

The operator of the country's largest restaurants chain under the Dominos brand, Jubilant's operating revenue grew 131% to Rs 8.8 bn from Rs 3.8 bn in June 2020 quarter.

The company said the growth was driven by like-for-like sales growth (at 120%) and same-store growth of 114% in Domino's Pizza.

It also said the growth in deliveries witnessed during the second wave of the pandemic helped it offset the decline in dine-in.

Jubilant FoodWorks delivery channel during the quarter grew by 124%.

Its earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the quarter stood at Rs 2.1 bn and its EBITDA margin was 24%.

--- Advertisement ---
This is a Powerful Mega Trend Playing Out in India

We have uncovered a powerful mega trend that is playing out in India right now.

It could potentially generate immense wealth for early movers.

Our co-head of research Tanushree Banerjee has also zeroed in on one specific stock riding this mega trend.

It's her #1 stock pick right now.

And she believes, this could be one of the top stocks to get to potential Rs 7 crore wealth over the long term.

Tanushree will reveal all the details about this mega trend and her #1 stock at her special online event on July 29.

At the event Tanushree will also show you, how to potentially accumulate Rs 7 crore in wealth over the long term.

What you learn at the event could possibly change your financial fortunes forever.

Click here to reserve your FREE seat.
------------------------------

Expansion to resume

Jubilant FoodWorks added 29 stores last quarter - 20 new outlets for Domino's Pizza, and three stores each for its other brands Dunkin Donuts, Ekdum!, and Hong's Kitchen.

It opened stores in five new cities during the quarter.

The lockdowns and the restrictions due to the pandemic presented a lot of on-ground challenges and they interrupted our store expansion momentum, leading to a lower number of new stores,' informed co-chairman of Jubilant FoodWorks, Hari Bhartia.

The company now plans to accelerate its store expansion and plans to open about 150-175 stores in the financial year 2022. The majority of these would be Domino's Pizza.

'Domino's Pizza will continue to power ahead and we see a clear potential of 3,000 stores in India in the medium to long term for the brand,' said Pratik Pota, CEO, and whole-time director, Jubilant FoodWorks, during the investor call.

According to the company, it will open a mix of formats during the year, some of which would be shared stores between its three brands - Dunkin Donuts, Ekdum!, and Hong's Kitchen - focused on deliveries, while others would be standalone stores for all its brands, including Domino's Pizza.

Free Signup: The Smallcap Revival Summit

Company's recovery on track

Jubilant FoodWorks reported an almost 94% recovery in the first quarter of the financial year 2022 when compared to the pre-pandemic period of the quarter one of 2020.

The company had reported a net profit of Rs 714.8 m in the first quarter of 2020 and its revenue from operations during the period stood at Rs 9.5 bn.

During a post-earnings call, Hari Bhartia, Co-chairman of Jubilant FoodWorks said,

  • As the covid caseloads increased, we were faced with multiple restrictions. Dining operations were largely shut across the country.

    Mobility restrictions severely impacted our takeaway channel. State-specific delivery restrictions increased the on-ground challenges further.

However, he added, despite the reduction in operating hours and operational stores on dining, sales recovery in Domino's was led by strong growth in the delivery channel.

According to Bhartia, the easing of restrictions going ahead will result in sequential improvement in the company's operating performance.

E-commerce domination will drive sales growth

The segment's quick adoption of e-commerce and delivery-led models made them less susceptible to the second wave even as stores were shut due to the lockdowns.

The pandemic has accelerated the push towards digitisation and the early movers, which continue to invest in their digital capabilities will benefit in the long-term.

--- Advertisement ---
How Fund Managers Spot Winning Stocks

Fund managers don't buy stocks on a whim. They buy only when they can get the best price in the market.

By using Wyckoff Accumulation Analysis, you can get the same edge as fund managers.

Watch this video to learn how to spot winning stocks like fund managers.
------------------------------

Quick service restaurants show strong appetite for growth

The quick service restaurants (QSRs) have gained a major market share in a short period. They were the first off the blocks last year when the restrictions were lifted.

Most likely, the trend will repeat itself this year as well once the covid-19 wave subsides.

According to a leading financial daily, QSRs are in a sweet spot for rapid growth over the next 5 to 10 years in India and offer scope for a 25 - 30% operating profit CAGR (compound annual growth rate) for several players, with Domino's as the most efficient among them.

How the stock markets reacted to Jubilant FoodWorks

Shares of Jubilant FoodWorks opened the day at Rs 3,215 on the BSE and Rs 3,207 on the NSE.

At the time of writing, the company's shares were trading up by 11.3% on the BSE.

At its current price, it is trading at a P/E of 120.9.

The share touched its 52-week high of Rs 3,447.6 and 52-week low of Rs 1,656.4 on 22 July 2021 and 27 July 2020, respectively.

Over the last 30 days, the Jubilant FoodWorks share price is up 3.1%. Over the last one year, the company's share price is up 91.2%.

About Jubilant FoodWorks

Jubilant FoodWorks was incorporated on 16 March 1995 as Domino's Pizza India Private Limited and began operations in 1996.

It changed its name to Jubilant FoodWorks in 2009. The company opened India's first Domino's Pizza outlet in New Delhi in 1996.

The company is a part of the Jubilant Bhartia Group, owned by Shyam Sunder Bhartia.

It has two strong international brands in its portfolio Domino's Pizza and Dunkin' Donuts addressing different food market segments.

The Indian food service company has the exclusive rights to develop and operate Domino's Pizza brand in India, Sri Lanka, Bangladesh, and Nepal.

It also has exclusive rights for developing and operating Dunkin' Donuts restaurants for India.

For more details about the company, you can have a look at Jubilant FoodWorks factsheet and quarterly results on our website.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

Equitymaster requests your view! Post a comment on "Jubilant FoodWorks Hits Record High on Strong Sales Recovery in June Quarter". Click here!

  

More Views on News

Why Did Shares of Jubilant FoodWorks Rally Today? (Views On News)

Jun 16, 2021

The company sees a 90% recovery despite minimal dine-ins.

JUBILANT FOODWORKS Announces Quarterly Results (3QFY21); Net Profit Up 20.6% (Quarterly Result Update)

Feb 5, 2021 | Updated on Feb 5, 2021

For the quarter ended December 2020, JUBILANT FOODWORKS has posted a net profit of Rs 1 bn (up 20.6% YoY). Sales on the other hand came in at Rs 11 bn (down 0.2% YoY). Read on for a complete analysis of JUBILANT FOODWORKS's quarterly results.

JUBILANT FOODWORKS 2019-20 Annual Report Analysis (Annual Result Update)

Dec 17, 2020 | Updated on Dec 17, 2020

Here's an analysis of the annual report of JUBILANT FOODWORKS for 2019-20. It includes a full income statement, balance sheet and cash flow analysis of JUBILANT FOODWORKS. Also includes updates on the valuation of JUBILANT FOODWORKS.

Zomato Delivers a Hot Listing. Did You Grab a Bite? (Views On News)

Jul 23, 2021

Zomato scripted history on Friday by becoming India's first unicorn to debut on the stock exchanges.

Varun Beverages Q1 Review: Net Profit Rises Two-Fold; Board Announces 1:2 Bonus Issue (Views On News)

May 4, 2021

Varun Beverages' two-fold jump in profit came on the back of strong volume growth and demand recovery.

More Views on News

Most Popular

All You Need to Know About Primary and Secondary Markets

A look at the various types of primary and secondary markets and the key differences between them.

RBI Opens a New Market for Investors (Fast Profits Daily)

Jul 16, 2021

You now have a new way to create wealth. Grab it with both hands.

A Better Way than the Zomato IPO to Play the Food Delivery Megatrend (Profit Hunter)

Jul 14, 2021

A unique backdoor way of making big profits from smallcap companies.

These Are the Best Stocks to Own (Fast Profits Daily)

Jul 22, 2021

Find out what I think are the best kind on stocks to own in the market.

Heads Up Bank Nifty Traders (Fast Profits Daily)

Jul 14, 2021

The RBI raised bond yields on 10yr benchmark paper. That can impact Bank Nifty traders in the coming days.

More

Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2021
Get our special report Multibagger Stocks Guide (2021 Edition) Now!
We will never sell or rent your email id.
Please read our Terms

JUBILANT FOODWORKS SHARE PRICE


Jul 26, 2021 (Close)

TRACK JUBILANT FOODWORKS

  • Track your investment in JUBILANT FOODWORKS with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

MORE ON JUBILANT FOODWORKS

JUBILANT FOODWORKS - P&G COMPARISON

COMPARE JUBILANT FOODWORKS WITH

MARKET STATS