- Motilal Oswal cut Jubilant FoodWorks target price to Rs 500 with Neutral rating
- Q4 weak performance and margin pressure cited as reasons for price cut
- Long-term growth outlook intact despite near-term demand and cost challenges
NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
The brokerage firm Motilal Oswal has trimmed its target price on Jubilant FoodWorks Ltd. to Rs 500 while maintaining a ‘Neutral' rating, citing a weak Q4 performance and continued near-term pressure on margins.
The brokerage highlighted that while the company's long-term growth outlook remains intact, weak demand trends and cost pressures are likely to weigh on earnings in the near term.
There are no material changes to the brokerage's Ebitda estimates for FY27 and FY28.
Jubilant FoodWorks is benefiting from strong delivery-led traffic growth, driving near-term outperformance versus peers. On the international front, DP Euresia's interest costs are fully funded by the Turkey business with no cash outflow from India.
Jubilant FoodWorks' focus on customer acquisition and order frequency has been driving strong delivery growth. For dine-in, the company continues to take various steps, such as value offerings and product innovations, to drive channel growth.
While management remains confident on medium-term growth (5-7% like-for-like), near-term demand trends remain monitorable amid weak dine-in traction. Higher commodity costs, along with LPG shortages and labor costs, are expected to weigh on near-term margins.
The brokerage estimates standalone revenue CAGR of 13% over FY26-28 and pre-Ind-AS Ebitda margin of 12.5%-13.0% over FY26-28E.
Motilal Oswal values the India business at 25x EV/Ebitda (pre-IND AS) and the international business at 10x EV/Ebitda on Mar'28E. The brokerage reiterates its Neutral rating on Jubilant FoodWorks with a target price of Rs 500.
Click on the attachment to read the full report:
ALSO READ: Ola Electric Shares Slump Over 5% On A Weak Q4 And Positive Management Claims — Should You Buy?
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
