Wednesday, March 11
Shares of Jubilant FoodWorks were trading around Rs 476.20, down 1.28% in early trade on Wednesday on the National Stock Exchange of India.
The stock is in focus after brokerage Goldman Sachs maintained a ‘Neutral’ rating on Jubilant FoodWorks while keeping a ‘Buy’ rating on Devyani International and monitoring the sector’s demand recovery trends.
Goldman Sachs view on the QSR sector
Goldman Sachs noted that same-store sales growth (SSSG) momentum is improving across India’s quick-service restaurant (QSR) sector. The brokerage expects fourth-quarter SSSSG to converge closer to Domino’s, indicating improving demand conditions.
The improvement is being supported by value-driven meal offerings, which are helping restaurants drive higher transactions and bring customers back to dine-in channels.
Value offers supporting demand recovery
The brokerage highlighted that promotional pricing strategies are helping QSR chains improve footfalls and transaction volumes.
For instance, the KFC Krisper meal priced at Rs 999 has reportedly helped boost customer transactions in the sector.
A low base effect from last year is also expected to support stronger same-store sales growth in the current quarter.
Seasonal factors aiding March performance
According to Goldman Sachs, the shift in Ramzan timing this year is creating a favourable base for March sales for restaurant chains.
However, the brokerage cautioned that geopolitical disruptions remain a potential risk for the sector, as any economic uncertainty or disruption could impact consumer spending patterns.
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