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Jubilant Foodworks
Demand Trends, SSS growth and store expansion: Management highlighted that
demand trends for them remain fairly healthy. While early signs of downturn are
visible; management has not seen any significant impact on volume offtake yet at the
stores. Management remains confident to end year with 20%+ Same Store sales
growth in FY12. This fiscal extent of price increases has been higher than the past
and high single digit price growth contributed to SSS growth rates in 1HFY12.
Commitment of Dominos remains quite strong for expansion into India and they
believe there is opportunity to add 70-80 stores per year over medium term.
Margins: Milk led inflation (rising cheese prices) is a key concern for gross
margins. They intend to keep COGS at 25-26% of sales. Management guided that
they should be able to maintain atleast FY11 margins (17.7% EBITDA margins in
FY11). Over medium term operating margins will likely benefit from increasing ratio
of old store to new stores and SG&A leverage.
Dunkin Donuts: Management is quite optimistic about success of Dunkin Donuts
business in India. Consumer trials are underway and management expects to launch
their first store in 1HCY12. Pricing strategy for this format is being firmed up
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Jubilant Foodworks
Demand Trends, SSS growth and store expansion: Management highlighted that
demand trends for them remain fairly healthy. While early signs of downturn are
visible; management has not seen any significant impact on volume offtake yet at the
stores. Management remains confident to end year with 20%+ Same Store sales
growth in FY12. This fiscal extent of price increases has been higher than the past
and high single digit price growth contributed to SSS growth rates in 1HFY12.
Commitment of Dominos remains quite strong for expansion into India and they
believe there is opportunity to add 70-80 stores per year over medium term.
Margins: Milk led inflation (rising cheese prices) is a key concern for gross
margins. They intend to keep COGS at 25-26% of sales. Management guided that
they should be able to maintain atleast FY11 margins (17.7% EBITDA margins in
FY11). Over medium term operating margins will likely benefit from increasing ratio
of old store to new stores and SG&A leverage.
Dunkin Donuts: Management is quite optimistic about success of Dunkin Donuts
business in India. Consumer trials are underway and management expects to launch
their first store in 1HCY12. Pricing strategy for this format is being firmed up
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