BUZZ-Street View - India's Jubilant faces dilemma between growing the pie and boosting profit

Reuters11-14
BUZZ-Street View - India's Jubilant faces dilemma between growing the pie and boosting profit

Domino's India operator Jubliant Foodworks reports a near tripling of quarterly profit from last year and strong revenue growth also driving gains in its shares.

** Jubilant Foodworks JUBI.NS jumps 8.3% to 621.2 rupees after Q2 results, set for best one day pct rise in 15 months, if gains hold

** Revenue jumps nearly 20% and like for like growth of ~9% outperforms industry

MARGIN EXPANSION A 'KEY INVESTOR CONCERN'

** Emkay Global (maintains 'buy' and PT of 825 rupees) says slow margin expansion has been a key concern for investors despite industry-leading topline growth

** Ambit Capital (maintains 'sell'; PT marginally higher at 580 rupees) says delivering margin expansion would be difficult without impacting growth momentum, adding it sees "downside risk" to margin guidance

** Antique Stock Broking (maintains 'hold'; cuts PT to 600 rupees from 670 rupees) says profitability will see moderate expansion as cheaper offerings dominate, and price hikes remain limited

** Adds, optimism about recovery in performance already factored into valuation

** JUBI rated 'buy' on averge by 29 analysts; median PT at 715 rupees

** JUBI down ~14.5% YTD

(Reporting by Ananta Agarwal in Bengaluru)

((Ananta.Agarwal@thomsonreuters.com))

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment