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Steady performance; growth outlook improving

* JUBI reported 9% YoY standalone revenue growth in 1QFY27 (in line). Domino’s LFL growth improved to 2.5% (0.2% in 4QFY26) on a high base of 12%, and orders grew 6.5% YoY. Delivery revenue was up 12%, while AOV increased by high single digits QoQ. The DITA channel (dine-in and takeaway) also showed early improvement, with order volumes stabilizing and order values improving. Popeyes delivered strong 97% revenue growth, with 45% LFL growth. Management expects 2QFY27 to be better than 1QFY27, with the trajectory further improving in 2HFY27E.

* Gross margin expanded 130bp YoY to 75.5% supported by pricing, better mix, supply-chain efficiencies and lower wastage. Despite inflation in LPG, labour, cheese, oil and chicken, a 140bp net price increase and productivity initiatives limited the margin impact. EBITDA Pre-Ind AS margin dipped 20bp YoY to 12.1% (est. 11.9%), while EBITDA grew 7.5% (in line).

* DP Eurasia revenue grew 28%. Domino’s Turkey LFL declined 1% and COFFY LFL declined 13% (inflation-adjusted). PAT margin stood at 6.9% (vs. 9.4% in the base period). Domino’s Sri Lanka and Bangladesh reported strong revenue growth of 41% and 26% YoY, respectively.

* We remain positive on JUBI’s medium-term outlook, supported by 5-7% LFL growth potential, strong Popeyes momentum and healthy international performance. The company is also progressing on margin recovery, with productivity gains, supply-chain efficiencies and calibrated pricing helping offset commodity inflation. We model a standalone revenue CAGR of 13% over FY26–28E and pre-Ind AS EBITDA margin of 12.5-13.0%. We recently upgraded JUBI to BUY from Neutral in our QSR thematic with a TP of INR625, valuing the India business at 28x EV/EBITDA and the international business at 18x EV/EBITDA on Mar’28 estimates.

Highlights from the management commentary

* Management expects 2QFY27 to be better than 1QFY27 and remains confident of building a business capable of delivering 5-7% medium-term LFL growth.

* The company maintained guidance of opening 1,000 stores across brands in India between FY25–28.

* Popeyes delivered over 40% LFL growth for the third consecutive quarter, with ADS crossing INR95,000. Management sees Popeyes becoming a second growth engine for JUBI.

* Management continues to target ~200bp of EBITDA margin improvement, with roughly half expected from Domino’s and half from the emerging brands

Valuation and view: Reiterate BUY

* There are no material changes to our EBITDA estimates for FY27 and FY28.

* JUBI’s focus on customer acquisition and order frequency has been driving strong delivery growth. For dine-in, the company continues to take various steps, such as value offerings and product innovations, to drive channel growth.

* We remain positive on JUBI’s medium-term outlook, supported by 5-7% LFL growth potential, strong Popeyes momentum and healthy international performance. The company is also progressing on margin recovery, with productivity gains, supply-chain efficiencies and calibrated pricing helping offset commodity inflation. We model a standalone revenue CAGR of 13% over FY26– 28E and pre-Ind AS EBITDA margin of 12.5-13.0%. We recently upgraded JUBI to BUY from Neutral in our QSR thematic with a TP of INR625, valuing the India business at 28x EV/EBITDA and the international business at 18x EV/EBITDA on Mar’28 estimates.

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