Jubilant FoodWorks: Motilal Oswal Maintains Neutral Rating, Sets Target Price After 16% Revenue Growth in 2QFY26

Motilal Oswal's latest research report on Jubilant FoodWorks provides an analysis of the company's performance in the second quarter of fiscal year 2026 (2QFY26).

The company reported a 16% year-over-year (YoY) growth in its standalone revenue, reaching INR 17 billion, which was in line with expectations.

Key performance indicators for its popular Domino's brand showed positive trends. Domino's experienced an order growth of 15% and a like-for-like (LFL) growth of 9%. The delivery segment continued to be a strong contributor, posting a robust 22% YoY revenue increase with an LFL growth of 17%. This segment now accounts for 74% of total sales, up from 70% in the same period last year.

However, the dine-in segment faced challenges. Revenue from dine-in customers remained flat year-over-year, despite a 14% increase in in-store traffic. This was primarily due to a significant 19% decline in takeaway orders, which analysts believe is a consequence of the company's attractive free 20-minute delivery offer.

Outlook and Valuation:

Motilal Oswal values the India business at 30 times EV/EBITDA (pre-IND AS adjustments) and the international business at 15 times EV/EBITDA, based on September 2027 estimates. The brokerage firm reiterates its 'Neutral' rating on Jubilant FoodWorks with a target price of INR 650.

Impact:

This research report suggests a steady outlook for Jubilant FoodWorks, with the stock currently appearing fairly valued. The strong performance of the delivery business is a key positive driver. However, the flat dine-in revenue and declining takeaway orders due to the aggressive delivery offer highlight a strategic trade-off that investors should monitor. The Neutral rating indicates that significant short-term price movements might not be expected, but the company's growth trajectory remains under analyst observation.

Rating: 6/10

Difficult Terms Explained:

• YoY (Year-over-Year): A comparison of a metric from one period to the same period in the previous year.
• INR: Indian Rupee, the official currency of India.
• 2QFY26 (Second Quarter of Fiscal Year 2026): Refers to the three-month period ending September 30, 2026, as part of India's fiscal year which typically runs from April 1 to March 31.
• LFL (Like-for-Like) Growth: Measures the sales growth of stores that have been open for a specific period (usually one year or more), excluding the impact of new stores or closures. It provides a clearer view of organic growth.
• Delivery Business: Revenue generated from orders fulfilled through home delivery services.
• Dine-in Revenue: Revenue earned from customers consuming food within the restaurant premises.
• Takeaways: Revenue from customers purchasing food to be consumed off-premises, typically collected from the restaurant.
• EV/EBITDA (Enterprise Value to Earnings Before Interest, Taxes, Depreciation, and Amortization): A valuation multiple used to assess the value of a company. It compares the company's total value to its operating earnings.
• IND AS (Indian Accounting Standards): A set of accounting rules and principles followed in India.
• Sep’27E (September 2027 Estimates): Financial projections or estimates made for September 2027.
• Neutral Rating: An investment recommendation from an analyst suggesting that the stock is neither a strong buy nor a strong sell, implying it is likely to perform in line with the market or its peers.