Domino's Pizza Operator Jubilant FoodWorks Falls Despite Q4 Revenue Growth—Here's Why

Jubilant FoodWorks Ltd's shares fell over 4% on Monday after the company reported a 33.9% year-on-year rise in consolidated revenue from operations for the March quarter. The revenue stood at Rs 2,107 crore, driven by 12.1% like-for-like growth in Domino’s India, according to its exchange filing from late Friday.

The company also added a net 56 new stores during the quarter, taking its total network to 3,316 stores across geographies. Of this, 52 new Domino’s India outlets were opened, while 12 were shut.

Brokerages responded to the update with mixed views. Morgan Stanley said the fourth-quarter performance beat expectations and that sales momentum from the previous quarter had been sustained. It retained an ‘overweight’ rating with a price target of Rs 781 per share.

Goldman Sachs maintained a ‘neutral’ stance with a price target of Rs 700, citing better-than-expected same-store sales in India but cautioning that margins could stay muted despite topline strength.

Jubilant FoodWorks' stock fell as much as 4.36% during the day to Rs 650 apiece on the NSE. It was trading 2.77% lower at Rs 660.75 apiece, compared to a 3.97% decline in the benchmark Nifty 50 as of 10:59 a.m. 

It has fallen 8.69% in the last 12 months and risen 42.41% on a year-to-date basis. The relative strength index was at 61.62.

Eighteen out of 31 analysts tracking the Domino's operator have a 'buy' rating on the stock, eight recommend a 'hold' and five suggest a 'sell', according to Bloomberg data. The 12-month analysts' consensus target price on the stock is Rs 702.27, implying an upside of 3.3%.