BOB Capital Markets has reiterated its BUY call on Jubilant FoodWorks (JUBI IN) with a revised target price of Rs 676, implying an upside of approximately 22% from the current market price of Rs 554.

Over the December quarter, Jubilant FoodWorks delivered a resilient operational performance, driven by delivery-led growth, steady same-store sales expansion, and improving profitability across domestic and international markets. Domino’s India maintained its dominant market share in the pizza category, while Popeyes and Turkey operations contributed incremental earnings stability. Management remains confident of sustaining 5–7% like-for-like (LFL) growth, underpinned by product innovation, disciplined store expansion, and digital traction. With margin recovery underway and debt steadily declining, BOBCAPS values the company using a Sum-of-the-Parts (SOTP) framework, justifying its revised Rs 676 price target.

Q3FY26: Delivery-Led Momentum Anchors Growth

Jubilant FoodWorks reported standalone revenue of Rs 18 bn, up 11.8% year-on-year, supported by 5% LFL growth. On a consolidated basis, revenue rose 13.3% YoY to Rs 24.4 bn. The quarter reflects consistent execution rather than a sharp cyclical rebound.

Gross margins moderated marginally to 71.6%, down 42 basis points YoY, largely due to input cost movements. However, EBITDA surged 20% to Rs 4.8 bn, with margins holding steady at 19.8%. This stability underscores improving operating leverage.

Adjusted PAT for Q3FY26 stood at Rs 1,066 mn, reflecting robust triple-digit growth on a YoY basis, with profit margin improving to 4.4% of sales.

Domino’s India: Eighth Consecutive Quarter of Positive LFL

Domino’s India remains the company’s growth engine. LFL growth came in at 5%, marking the eighth straight quarter of positive same-store growth.

Delivery continues to dominate the consumption mix at 74.9%, supported by free-delivery campaigns and 20-minute delivery guarantees. Monthly active users on the Domino’s app rose 28% YoY to 17 million, reinforcing digital engagement.

The company added 93 Domino’s stores during the quarter, taking the total network across brands and geographies to 3,594 stores. City penetration has now reached 511 cities, reflecting continued market deepening.

Management has guided for 5–7% LFL growth and 7–10% store expansion annually, with no immediate demand headwinds anticipated.

Popeyes and Product Innovation Strengthen Portfolio

While Domino’s commands scale, Popeyes is emerging as a meaningful second growth vector.

Popeyes delivered double-digit SSSG, driven by menu innovations such as “Flavour Burst Burgers” and chicken nugget variants. Management intends to optimise average daily sales and gross margins before accelerating toward a medium-term goal of 250 stores and Rs 10 bn in revenue.

Product innovation across brands—including “Cheese Lava Pull Apart” and sourdough pizzas—continues to enhance ticket size and repeat consumption.

Turkey Operations: Stability and Debt Discipline

The Turkey business delivered 6.3% inflation-adjusted LFL growth and generated Rs 5.8 bn in quarterly revenue.

A critical milestone is the refinancing of acquisition-related debt from Turkish Lira to Euro, leading to a 59% reduction in finance costs YoY. The subsidiary is now servicing its Euro 110 mn debt through internal cash flows and upstreaming dividends.

This operational stabilisation materially reduces balance-sheet risk.

Financial Trajectory: Earnings Recovery Underway

Below is a snapshot of key financial projections:

BOBCAPS models revenue and EBITDA CAGRs of 7.9% and 8.3%, respectively, over FY26–FY28E. Adjusted EPS is expected to grow 54% in FY26E and 39.7% in FY27E.

Debt reduction is another notable feature. Debt funds are projected to decline from Rs 15,022 mn in FY25A to Rs 1,022 mn by FY28E, significantly strengthening leverage metrics.

Valuation Framework and Target Levels

BOBCAPS employs an SOTP valuation:

India business valued at 35x EV/EBITDA (pre-Ind AS)

DP Eurasia valued at 35x P/E

This yields a revised fair value of Rs 676 per share.

At the current price of Rs 554:

FY26E P/E: 109.3x

FY27E P/E: 78.2x

EV/EBITDA (FY27E): 17.5x

While valuations appear optically expensive on near-term earnings, the premium reflects market leadership, digital scale, and earnings inflection visibility.

Investment View: Accumulate on Structural Strength

Jubilant FoodWorks combines:

Category leadership (65–70% pizza market share in India)

Strong digital ecosystem

Improving margin trajectory

Deleveraging balance sheet

International earnings diversification

Technical Levels:

Immediate support: Rs 500–520 (recent consolidation zone)

Strong support: Rs 480 (52-week low zone)

Resistance: Rs 640–660

Target: Rs 676 (12-month horizon)

The stock has corrected from its 52-week high of Rs 728, offering a favourable risk-reward profile for long-term investors.

Key Risks to Monitor

Escalation in raw material costs

Aggressive competitive store expansion

Slower-than-expected same-store growth

Prolonged weakness in takeaway consumption

In conclusion, Jubilant FoodWorks is transitioning from margin compression to profitability recovery. Delivery dominance, menu innovation, and disciplined capital allocation form the cornerstone of its earnings revival. For investors willing to look beyond near-term valuation multiples, the company offers a compelling structural growth story with improving return ratios and balance-sheet resilience.