UBS has taken a decisively more bullish stance on Jubilant FoodWorks, double-upgrading the stock from ‘Sell' to ‘Buy' and raising its price target to Rs 600 from Rs 540. The move implies a meaningful upside from current levels, with the brokerage arguing that the recent correction has created a favourable entry point for investors willing to take a contrarian view.
According to UBS, the stock's sharp pullback — driven by concerns such as elevated LPG costs and near-term demand pressures — has already priced in much of the downside. With valuations now sitting below historical averages, the brokerage sees room for a re-rating as operating conditions normalise.
Domino's Remains The Growth Engine
Central to the upgrade is the continued strength of Domino's India. UBS describes the business as a resilient, market-leading franchise that has consistently outperformed the broader QSR space. That track record, combined with ongoing store expansion, is expected to support double-digit structural revenue growth over the medium term.
Jubilant's delivery-first strategy continues to be a key advantage. The company has steadily evolved its model — whether through menu innovation, pricing tweaks or digital capabilities — to stay aligned with changing consumer habits. This flexibility, UBS believes, positions it well to navigate demand cycles better than peers.
Margins and Popeyes Offer Upside Levers
UBS also sees around 200 basis points of margin expansion over the next three years, driven by operating leverage and easing cost pressures. Beyond Domino's, Popeyes is emerging as a potential value unlock. As the brand scales up in India, it could begin to contribute more meaningfully to both revenues and profitability.
Taken together, UBS believes the risk-reward equation has shifted in favour of investors. While near-term uncertainties remain, much of the negative sentiment appears to be reflected in current valuations.
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