The IIFL Securities Report: Buy Jubilant Foodworks - June 05

IIFL Securities issued a "buy" recommendation for Jubilant Foodworks at its current market price of Rs 535.2 on June 5th. The investment firm anticipates an upward trajectory for the stock, setting a target price of Rs 555. This call suggests that IIFL Securities expects the company's performance to improve and that investors could potentially benefit from purchasing shares at the current market price.

About Jubilant Foodworks:

Jubilant Foodworks is a leading Indian food service company listed on the National Stock Exchange (NSE) of India. It owns and operates popular restaurant chains such as Domino's Pizza, Dunkin' Donuts, and Popeyes in India. The company has a strong presence across the country with over 1,500 outlets. Jubilant Foodworks also has a joint venture with Tim Hortons to operate its coffee shops in India. The company has a strong focus on innovation and customer satisfaction, and has consistently delivered strong financial performance over the years.

52 Week Price Trend:

Jubilant Foodworks, the operator of popular restaurant chains like Domino's Pizza and Dunkin' Donuts in India, is currently trading at Rs 535.2, close to its 52-week low of Rs 412.1. The stock has been under pressure in recent months due to concerns over rising input costs and intense competition in the food delivery market. However, the company's strong brand recognition and wide distribution network could provide support to its long-term growth prospects. Analysts remain divided on the stock's near-term outlook, with some expecting a rebound while others remain cautious.

Stratzy's MOST Analysis:

JUBLFOOD has been rated BB- by Stratzy's MOST framework, indicating medium fundamental risks. This rating is based on the company's management, outlook, safety, and trend. JUBLFOOD's management is generally well-regarded, and the company has a strong market position in the food distribution sector. The outlook for the company is also positive, with expected growth in the food distribution market. However, JUBLFOOD's financial safety is a concern, as the company has a high debt-to-equity ratio. Additionally, the stock price has been volatile, indicating some uncertainty about the company's future performance.

Company's Fundamentals:

Jubilant Foodworks, known for its popular Domino's Pizza and Dunkin' Donuts chains, holds a high stock price-to-earnings (PE) ratio of 145.67, indicating that investors are willing to pay a premium for each rupee of its earnings. Its price-to-book (PB) ratio of 15.38 suggests that its market value exceeds its accounting value by a significant amount. Despite these valuations, Jubilant Foodworks has a low dividend yield of 0.25%, signaling that the company prefers to reinvest its profits for growth rather than distribute them to shareholders through dividends.

Fundamental and Technical information provided in this blog were last updated on 05 Jun, 2024

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