Jubilant Foodworks - Window Opens, Downgrade to SELL - Emkay

Reco: SELL
CMP: Rs 1189
Target Price: Rs 1000

- Growth momentum for Jubilant FoodWorks (JFL) continues in Q1FY13; APAT growth at 39.6% yoy to Rs323 mn

- Many negatives brewing (1) SSG growth slides to 22% with inherent volume growth of 10% and (2) Dunkin Donuts operation to hit Ebidta margins by 0.6%

- 1st ever earnings downgrade of 6% for FY13E and 5% for FY14E and Ebidta margin expansion story halted; Window for further downgrades has opened

- Earnings downgrades does not justify sustenance of premium valuations; Downgrade JFL to SELL with price target of Rs1000/Share (30X FY14E Earnings).

Source : Equity Bulls

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