Jubilant FoodWorks - Turkey Attraction Marred By Currency Issues: Prabhudas Lilladher

Prabhudas Lilladher Report

Jubilant FoodWorks Ltd.'s concall highlighted the growth trajectory and plans for DP Eurasia and Bangladesh.

Jubilant FoodWorks recently increased stake in Dp Eurasia to 94% while it had increased stake in Bangladesh to 100% in 2022. The Turkish business presents an attractive long-term prospect driven by geographical expansion (addition of 560 stores in medium term), 51% market share , strong brand recall, the expanding COFFY network, and a margin-accretive franchise model that reduces store operating costs.

However, currency devaluation remains a significant concern due to the continuous downtrend of the Turkish currency (Lira has depreciated from Rs 28 in 2012 to current levels of 2.5).

Bangladesh business is still in the nascent phase, with only 26 stores. Nevertheless, it is experiencing robust growth in existing stores and presents an opportunity to expand into more cities, making it a good option for expanding the footprint in international markets.

India business remains under pressure due to tepid demand in Pizza category and increase in competition. Popayes is shaping up well and is targetting Rs 10 billion sales in fastest time by any quick service restaurant.

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