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We maintain BUY on JUBI, while retaining our TP at Rs600 (20x Sep-28E EBITDA). The 2Q consol EBITDA miss of 5% was a blend of a 2% beat in India business, while International business EBITDA missed estimate by ~20% due to hyper-inflationary accounting norms; hence we cut FY28/29E EBITDA by 2- 3%. India revenue growth improved further, to 11.5% led by 9.2% growth in Domino’s and incremental contribution of 2.3% from Popeyes/Hong’s. Domino’s LFL continued to improve with 4.1% in 2Q (vs 2.5%/0.2% in 1Q/4Q), expected to further improve in 2H. Optimism on the LFL pick-up likely stems from the sustained growth in delivery (late night) and conscious efforts to turn around dine-in LFL, with infrastructure upgrades (~400 identified stores), best of the deals, and better attachments (desserts/beverages). Despite inflationled margin headwind of ~200bps, JUBI’s India EBITDA margin improved by ~20bps, helped by 150-200bps price hike and other cost/supply-chain efficiencies. With respect to margin guidance of ~200bps gain by FY28, JUBI is running ahead on the 100bps gain expected from loss reduction in Popeyes/Hong’s, while normalization of RM/utility costs should help deliver the remaining 100bps. Encouragingly, JUBI targets Rs10bn scale for Popeyes over coming 3-4 years, as the format is ramping up well with Rs90-95k ADS (LFL LTM: 40-50%) at a healthy ~68% gross margin (GM). JUBI expects to continue incurring capex of Rs7.5-9.0bnpa, albeit skewed toward high-return and revenue-generating assets.

India business margins better than expected; LFL growth improves sequentially

Consol revenue rose ~12% yoy, led by ~13% growth in DP Eurasia, while India business grew 11.5%. JUBI’s India growth was a blend of ~122% growth in Popeyes and 9.2% growth in Domino’s India (6.3% order growth). Encouragingly, LFL growth improved for Domino’s India business to 4.1% in 2Q (vs 2.5% in 1Q); JUBI reiterated its guidance of 5-7% LFL in FY27. Among channels, delivery continued to outperform with ~11.3% growth, while the DITA channel grew 2.4% yoy, supported by exclusive in-store value offers and initiatives to enhance the in-store experience. India GM increased by ~110bps yoy to 75.5%, aided by calibrated price hikes (~150-200bps), better mix, and lower discounting. India business EBITDA margin (pre-IndAS) stood at 12.4%, largely flat yoy (~70bps higher vs our estimate), as GM gains were offset by higher other expenses.

Popeyes scaling up well; focused on improving the unit economics

Popeyes continues to deliver a strong performance, with 2Q LFL growth of 53% (>40% LFL growth for the 4 th consecutive quarter) and has established itself as the company’s 2 nd growth engine. The company added 11 new stores in 2Q (store count: 99). ADS at Rs90k is now broadly at par with peers’. While the business is progressing well, improving store-level unit economics remain a priority. Management targets another 100–200bps GM improvement (68.5% in 2Q; up by ~150bps yoy) and higher ADS of ~Rs100k to strengthen store profitability. The company has identified the locations for its next 150 Popeyes stores, though annual additions are expected to remain rangebound at 40-45.

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