CLSA has maintained its underperform rating on Jubilant FoodWorks with a target price of ₹519, citing sustained cost pressures despite healthy sales growth in the first quarter of FY26. Standalone sales rose 18% year-on-year, in line with estimates, with same-store sales for Domino’s India showing 11% like-for-like growth. Sales per store increased 8% over the same period.
However, gross margins contracted by 199 basis points year-on-year to their lowest level in more than 30 quarters, driven by higher input and promotional costs. EBITDA fell short of expectations, prompting CLSA to cut its earnings estimates for FY26–28 by 5–11% to reflect the higher cost base. The brokerage noted that while top-line growth remains solid, margin compression continues to weigh on overall profitability, limiting near-term upside for the stock.
Disclaimer: The views and recommendations made in this article are those of CLSA. This article does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.
