Jubilant FoodWorks shares slump 5% on weak Q4 results

Shares of Jubilant FoodWorks Ltd, which owns the franchise of Domino's Pizza in the country, slumped as much as 5.1% on Thursday to hit an intraday low of ₹455.90 apiece on the BSE, a day after the company reported a decline in its net profit by 59.05% to ₹47.5 crore in the March quarter as against ₹116 crore in the same period last year, owing to soaring inflation.

On Thursday, the scrip opened 0.5% lower at ₹478. The scrip closed at ₹480.75 on Wednesday. At 11:32 am, the share price of Jubilant FoodWorks was trading 0.43% lower at ₹478. 70. In contrast, the broader BSE Sensex, was up 213 points or 0.35%. At present, the company's share price are trading 26.7% lower than the 52-week high of ₹652.20, which the company touched on October 6, last year. Jubilant FoodWorks' stocks are trading 16.1% lower on the 52-week low of ₹412.20, which the company touched on March 20 this year. In the past one month, the company's stock has given 9.15% returns, whereas it has given 5.25% return in the last three months.

In the January to March period, the company's revenue from operations grew 8.1% year-on-year to ₹1,252.3 crore against ₹1,157.8 crore in the March quarter of FY22. During the quarter under review, Jubilant FoodWorks' EBITDA (earnings before income, tax, depreciation and amortisation) slipped 12.9% year-on-year to ₹252.2 crore. In the March quarter of FY22, the company’s EBITDA stood at ₹289.7 crore. 

For FY23, the company's net profit tumbled 18.5% year-on-year to ₹356.12 crore against ₹437.5 crore. The company's revenue in FY23, however, grew 17.6% year-on-year to ₹5,095.9 crore against ₹4,331 crore in FY22.

Jubilant Foodworks operates Domino's Pizza, Dunkin' restaurants and Popeyes restaurants in India, Bangladesh, Nepal and Bhutan. The company currently operates 21 Dunkin' restaurants across six Indian cities and 13 Popeyes restaurants in two cities. In 2019, Jubilant FoodWorks launched its first owned-restaurant brand 'Hong’s Kitchen' in the Chinese cuisine segment which now has 13 restaurants across three cities.

For FY24, the company plans to "reorient the business to sustained profitable growth" amidst historic high inflation and slowing market growth. "As we step into the new fiscal year, we derive confidence from the strength of our brands, operational prowess, quality of innovation and commitment of our people to navigate the business well in the current environment," said Sameer Khetarpal, CEO and MD, Jubilant FoodWorks Limited.

Following the company's quarterly results, brokerage firms have revised the target price of Jubilant FoodWorks’ stocks. Reiterating the 'BUY' rating for the stock, analysts at Motilal Oswal have set a target price of ₹560 per share. Analysts at Prabhudas Lilladher have given a 'BUY' rating for the stock, with a revised target price of ₹515 per share. Analysts at Nirmal Bang have set a target price of ₹495 per share. Morgan Stanley has given an 'Overweight' rating, with a target price of ₹560 per share.

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