Jubilant FoodWorks Poised for Massive Expansion; ProTips Gives Valuable Info By Investing.com

By Investor Empires On May 23, 2024

Jubilant FoodWorks Ltd (JFL), the master franchisee of Domino's Pizza in India and several other markets, with a market capitalization of INR 31,517 crore, announced plans on Wednesday to significantly expand its store network. The company aims to increase Domino's Pizza outlets from 2,793 to more than 5,500 across six global markets in the medium term.

JFL operates in India, Turkey, Bangladesh, Sri Lanka, Azerbaijan and Georgia. Last year, its subsidiary, Cheerful food business (NS:) Dutch BV (JFN), has acquired DP Eurasia, the master franchisee of Domino's in Turkey and Georgia, thus expanding JFL's reach beyond Asia.

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As of 31 March 2024, JFL Group's store network spans six markets and includes 2,990 outlets across five brands. JFL owns the franchise rights to three global brands – Domino's Pizza, Popeyes and Dunkin' – and operates two of its own brands, Hong's Kitchen in India and COFFY in Turkey.

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However, delving into the basics through ProTips, some interesting information emerged. The company operates with interesting gross margins which is always a good sign of an efficiently run business. In fact, in March 2024, the company posted a net profit margin of 12.67%, the highest since September 2022.

The stock also has lower volatility than the broader markets, making it an easy stock to hold, especially for those who are more conservative. For dividend fans, you'll be happy to know that the company has been paying a dividend for the past nine years in a row.

All of this information is known without investors having to delve into the financial statements. That's why, before making any investment decision, it's essential to take a quick look at ProTips. It reads the basics and decodes the data into bite-sized, easy-to-read information.

In India, JFL has set an ambitious target of opening 4,000 Domino's stores in the mid-term, compared to its previous target of 3,000 stores. Domino's India is close to hitting 2,000 outlets and currently operates 1,995 stores in 421 cities, with 179 new stores added in the last year alone.

“FY24 is a pivotal year for JFL, transforming us from the largest foodservice company in India to one of the largest in emerging markets,” Hari S. Bhartia, co-president of JFL, said during the company's earnings call on Wednesday.

For the March 2024 quarter, JFL reported a 23.9% YoY increase in revenues to INR 1,572.8 Crores and an impressive 632% increase in profits to INR 208.9 Crores. This increase in earnings was largely due to a net gain of INR 170.2 Crores from remeasurement of previously held equity stakes post the acquisition of DP Eurasia.

CEO and Managing Director Sameer Khetarpal highlighted that Domino's India witnessed a positive turnaround in like-for-like sales in the fourth quarter, driven by strategic initiatives such as strengthening regional infrastructure, improving execution, revamping the brand, and offering targeted delivery fee waivers to stimulate demand during a slow period.

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