Jubilant FoodWorks share price has touched a 52-week high of Rs 3,278.35, rising over 3 percent in early trade on June 16 a day, after the company reported its March quarter earnings.
The company on June 15 posted a more than a three-fold jump in its consolidated net profit to Rs 105.30 crore for the fourth quarter ended March 2021. The company had posted a net profit of Rs 32.53 crore in the same quarter last year.
Revenue from operations rose 14.21 percent to Rs 1,037.85 crore versus Rs 908.75 crore.
The board has recommended a final dividend of Rs 6 (i.e. 60%) per equity shares of face value of Rs 10 each for the Financial Year 2020-21, subject to the approval of the shareholders in the ensuing Annual General Meeting.
The final dividend, if approved, will be paid/dispatched on or before September 25, 2021.
Here is what brokerages have to say about the stock and the company after the March quarter earnings:
Credit Suisse | Rating: Neutral | Target: Rs 2,900
Broking house cut FY22 EPS estimate by 3 percent due to COVID-19 impact in Q1. The margin upsides is unlikely hereon, a new format success is a key deliverable. Credit Suisse maintains neutral rating due to stretched valuations.
UBS | Rating: Neutral | Target: Rs 3,000
The growth drivers are in place, and execution will be the key. The portfolio expansion to drive the growth.
CLSA | Rating: Outperform | Target: Raised to Rs 3,300
The earnings growth of 6-9 percent is seen over FY22-23. The revamped management team is going to address growing business needs. The bold approach to capture food services opportunity makes the company a structural play.
Morgan Stanly | Rating: Overweight | Target: Rs 3,236
The management commentary is positive on scale-up potential, while we remain constructive on the company’s medium-term scaling strategy.
JPMorgan | Rating: Overweight | Target: Raised to Rs 3,425 from Rs 3,030
The positive growth supports premium multiples. The April/May 2021 revenue recovery rate was at 94.4 percent/87.7 percent YoY with June to be better. JPMorgan likes its strong on-ground execution capabilities supported by digital investments, while Popeyes to be a promising addition to the portfolio mix. Broking house stay overweight given medium-term growth prospects.
Prabhudas Lilladher | Rating: Accumulate | Target: Rs 3,370
Prabhudas Lillasher believes that the company is in the process of emerging as a multi-cuisine multi-brand play with entry into biryani (EkDum), Chinese foods (Hongs Kitchen) and chicken segment (Popeyes).
It also believes that the company will have to undertake significant investments over the years to make Popeyes a success, more so given the brand positioning of KFC.
It remains positive given strong growth and positioning and growth in core Dominos business.
Motilal Oswal| Rating: Neutral | Target: Rs 2,970
Broking firm cut FY22E/FY23E EPS estimate by 12.5%/5.2% due to the lockdowns triggered by the second COVID wave impacting the Dine-in business.
Nevertheless, the company continues to show strong momentum in the delivery and takeaway channel.
Expensive valuations (63.2x FY23E EPS) suggest that the upside seems to be fully captured in the price from a one-year perspective.
Sharekhan | Rating: Buy | Target: Rs 3,620
We have reduced our earnings estimates for FY2022 by 5% to factor in lower sales in Q1FY2022 affected by disruption caused by localised lockdowns. However, we increased earnings estimates for FY2023E by 4% due to a strong recovery in sales, led by multiple drivers.
With medium-term demand drivers in place and strong store addition plans, the company will continue to remain a dominant player in the domestic QSR space.
At 09:19 hrs, Jubilant Foodworks was quoting at Rs 3,272.85, up Rs 97.45, or 3.07 percent on the BSE.
Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
