JUBLFOOD - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 2.9

📊 Financials Overview:

• Revenue & Profitability: Quarterly PAT declined slightly (66.7 Cr. → 64.0 Cr.), showing pressure on margins.
• Margins: ROE at 9.82% and ROCE at 11.0% indicate modest efficiency.
• Debt: Debt-to-equity at 1.32 reflects high leverage compared to peers.
• Cash Flow: Dividend yield at 0.21% is negligible, limiting shareholder returns.

💹 Valuation Indicators:

• P/E Ratio: 156 vs Industry PE of 123 → significantly overvalued.
• P/B Ratio: Current Price / Book Value ≈ 16.1 → trading at a steep premium.
• PEG Ratio: -7.38 → negative, suggesting weak earnings growth outlook.
• Intrinsic Value: Current price (₹565) is above fair zone; undervaluation only near ₹500–₹520.

🏢 Business Model & Competitive Advantage:

• Jubilant FoodWorks operates Domino’s Pizza and other QSR brands in India.
• Competitive advantage lies in strong brand recognition, wide distribution network, and digital ordering platforms.
• However, rising costs and competitive QSR landscape pressure margins.

📈 Entry Zone & Holding Guidance:

• Entry Zone: Attractive near ₹500–₹520 (aligned with 52-week low).
• Long-Term Holding: Risky at current valuations; suitable only for investors betting on QSR growth story.

Positive

• Strong brand presence with Domino’s Pizza as market leader in QSR.
• DII holdings increased (+0.74%), showing domestic investor confidence.
• Digital ordering and delivery infrastructure provide scalability.

Limitation

• Extremely high P/E ratio (156) compared to industry average (123).
• High debt-to-equity ratio (1.32).
• Dividend yield is very low (0.21%).

Company Negative News

• FII holdings decreased (-0.94%), showing reduced foreign investor confidence.
• Quarterly PAT declined slightly (66.7 Cr. → 64.0 Cr.).

Company Positive News

• DII holdings increased (+0.74%), reflecting domestic support.
• Quarterly profit variation (+22.8%) shows resilience despite margin pressure.

Industry

• Industry PE at 123, lower than Jubilant FoodWorks’ valuation.
• QSR industry benefits from rising urban consumption, digital adoption, and delivery demand.

Conclusion

⚖️ Jubilant FoodWorks enjoys strong brand recognition and digital infrastructure but faces stretched valuations, high debt, and modest profitability. Investors should consider entry near ₹500–₹520 for better risk-reward. Long-term holding is viable only for those confident in India’s QSR growth trajectory.