Quick-service restaurant stocks in demand: Jubilant, Devyani rally up to 5%

In Q3FY25, Domino's pizza chain operator Jubilant FoodWorks has reported a 56.2 per cent year-on-year growth in consolidated revenue from operations at Rs 2,153 crore

Shares of listed quick-service restaurant companies are in demand; they have rallied by up to 5 per cent on the BSE in Monday’s intra-day trade after Jubilant FoodWorks (JFL) reported a strong business update for the quarter ended December 2024 (Q3FY25).

 

Shares of Domino’s operator JFL hit a fresh 52-week high of Rs 796.75, as they rallied 5 per cent amid heavy volumes. Since December, the stock has surged 24 per cent. The group has a strong portfolio of brands in emerging markets, with franchise rights for three global brands - Domino’s, Popeyes and Dunkin’ Donuts – and two own-brands, Hong’s Kitchen, an Indo-Chinese quick-service restaurant (QSR) brand in India, and a CAFÉ brand - COFFY in Turkey.

 

 

Shares of Devyani International (DIL), the largest franchisee for Yum Brands (KFC and Pizza Hut), has surged 6 per cent to Rs 202.20 on the BSE, on the back of a 1.5-fold jump in average trading volumes. 

 

DIL is also the sole franchisee for the Costa Coffee brand and stores in India. In addition, DIL caters to South Indian vegetarian food lovers with Vaango, launched over a decade ago and is a prominent brand in the food retail business (FRB) category with its Food Courts. DIL has a strong presence across airports in India, where it serves a variety of F&B offerings.

 

Shares of Sapphire Foods India, a leading YUM franchisee operator in the Indian subcontinent with presence in India, Sri Lanka and Maldives, has soared 5 per cent to Rs 366.30. The stock price of Restaurant Brands Asia (RBA) was up 3 per cent at Rs 85.75 on the BSE in intra-day trade today. In comparison, the BSE Sensex was down 0.05 per cent at 79,185 at 10:29 AM.

 

In Q3FY25, JFL reported a 56.2 per cent year-on-year (YoY) growth in consolidated revenue from operations at Rs 2,153 crore. For Domino's India, the Like-for-Like growth during the quarter stood at 12.5 per cent. At the end of the quarter, the Group network reached 3,260 stores, with a net addition of 130 stores during the quarter.

 

JFL operates through a unique commissary model, which provides it with a distinct competitive advantage. As its purchase function is centralised and it buys a large volume of ingredients (such as cheese, sauce and pizza boxes), JFL can leverage its scale and negotiate better prices with suppliers. Furthermore, centralised sourcing, warehousing and distribution of raw materials, as well as production of dough balls at commissaries reduce the storage space, thereby enabling the company to minimise store operating costs, according to CRISIL Ratings.