Buy Sapphire Foods Ltd for the Target Rs. 325 by Motilal Oswal Financial Services Ltd
* Demand trends were weak despite the festive season.
* PH same-store sales expected to decline 10% YoY. We expect no store additions during the quarter. Revenue is expected to decline 10% YoY.
* Sri Lanka is expected to sustain growth momentum, and we model an 18% revenue growth in 3Q.
* KFC revenue is expected to grow 11% YoY, led by store additions (11% YoY). We model 24 24-store addition and flat YoY same-store-sales growth.
* The GM is expected to remain stable largely, while the EBITDA margin is expected to contract due to negative operating leverage.

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