Emkay Upgrades Domino’s India Operator Jubilant FoodWorks- Here Is Why

Emkay Global has turned bullish on Jubilant FoodWorks Ltd (JUBI), upgrading the stock to Buy from Add and maintaining its target price at Rs 825. The brokerage expects healthy upside, citing the company’s strong first-quarter performance, resilient growth outlook, and signs of margin recovery ahead.

The upgrade follows Jubilant’s 18% year-on-year revenue growth and 22% EBITDA growth in its India business during Q1 FY26—well ahead of most peers in the quick-service restaurant segment.

“We upgrade JUBI to BUY (from Add) with unchanged TP of Rs825 (34x Jun-27 EBITDA), as we believe the recent correction was unwarranted in light of the Q1 revenue/EBITDA growth of 18%/22% in the India business and significant outperformance vs peers. Most peers (excl RBA) have seen EBITDA being flat or decline in Q1.  ,” Emkay stated in its report.

According to Emkay Global, while India gross margins fell 200 basis points to 74.1% in the quarter—hit by strong traction in recently launched, but margin-dilutive products such as Big Big Pizza and Chicken Burst sides—the brokerage believes this was a temporary blip. Emkay expects recovery driven by calibrated price increases, product re-engineering, and continued supply chain efficiencies.

Also Read: Chicken Burst Boosts Jubilant FoodWorks - Emkay Says ‘ADD’, But Should You Dig In? | Republic World

“JUBI also expects gross margin to start inching up with select price hikes and supply-chain efficiencies, as it sees the Q1 gross-margin dip (down by 200bps) as an aberration, given that it was impacted by better-than-expected traction in some of the dilutive new launches (Big-Big-Pizza/Chicken sides),” added Emkay in its report.

Domino’s India, the company’s flagship brand, recorded 17.7% revenue growth, with like-for-like sales up 11.6%. Delivery revenue jumped nearly 25%, lifting the delivery mix to 73% from 69% a year ago, while dine-in sales also returned to growth, aided by targeted initiatives like the Rs 99 lunch offer.

JUBI’s international business delivered an upside surprise, posting a profit of ₹276 million against expectations of a Rs 32 million loss. This was supported by a ~15% EBITDA beat and lower interest costs following debt restructuring. Turkey, Bangladesh, and Sri Lanka were key growth markets, with Turkey now positioned to service its acquisition debt from Q2 onwards, stated Emkay in its report.

Store expansion remained aggressive, with 71 new outlets added in Q1, including 61 Domino’s stores in India, taking the network to 3,387. Popeyes, now at 60 stores with a recent entry into Mumbai, is also a growth priority. The company reiterated its plan to open more than 1,000 stores over the next three years, alongside enhancing digital engagement—monthly active app users grew 21.5% and loyalty members jumped 48.6% year-on-year.

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