Jubilant FoodWorks has retained a “buy” recommendation on Domino’s Pizza franchise operator JUBI, although analysts have reduced the target price by around 8% to Rs550 from Rs600, citing near-term cost pressures.
The company reported fourth-quarter EBITDA that exceeded both market and analyst expectations by 5-8%. However, management flagged rising inflation in labour, utilities and logistics, prompting analysts to cut India EBITDA estimates for the next two years by 6-7%.
JUBI said quarterly growth moderation was largely due to a high base effect. Like-for-like sales growth remained flat in the quarter, compared with 6.5% growth for FY26, while two-year like-for-like growth stayed in the 6-7% range across quarters. The company expects demand trends to improve through FY27, though a planned margin expansion of around 200 basis points by FY28 may now take longer than expected.
To protect profitability, the company has introduced selective menu price increases and is working to reduce losses from emerging businesses, which currently weigh on margins by about 200 basis points.
India revenue rose 6.4% year-on-year in the fourth quarter, with Domino’s India growing 5%, supported by double-digit order growth. Management attributed weaker sales momentum partly to temporary disruptions, including Ramadan timing, school examinations and festival calendar shifts.
Outside India, the Turkey business delivered strong revenue and profit growth, aided by currency movements and debt refinancing. Meanwhile, Sri Lanka and Bangladesh turned EBITDA positive during FY26.
Among newer brands, Popeyes remained a standout performer, recording 28% same-store sales growth during FY26. The company added 17 Popeyes outlets during the year, taking the total store count to 78, and signalled plans for faster expansion as demand for chicken quick-service restaurants continues to rise.
