There is a particular kind of market injustice reserved for companies that do everything right at the wrong time. Jubilant Foodworks — the company that runs Domino’s Pizza in India and a growing international portfolio — just delivered a quarter that answered every question bears had been asking. Like-for-like growth held up on a tough base. Margins expanded. Store additions accelerated. The international business contributed positively. And the stock has still shed roughly 20% over the past year.
The disconnect between operational execution and share price performance is becoming hard to ignore. Two fresh brokerage reports — from BOB Capital Markets and Centrum — both carry BUY ratings and both argue that the market is mispricing a business that is visibly outperforming its peer set.
The Quarter: Every Box Ticked
Jubilant’s standalone revenue came in at Rs 18 billion, up 11.8% year-on-year, led by 5% like-for-like growth in Domino’s India. That 5% number needs context. It was delivered on a base of approximately 12% LFL growth in the year-ago quarter. BOB Capital Markets notes that “Domino’s India continued to lead growth with 5% LFL, aided by traction in delivery and steady new store additions.” Management has guided for 5-7% LFL growth over the coming quarters and stated that the company “does not see any near-term demand headwinds.”
The delivery channel continues to be the engine room, contributing 74.9% of Domino’s India revenue and growing 16% year-on-year. The Domino’s app now has 17 million monthly active users, up 28%. In a market where quick commerce and food aggregators are constantly threatening to disintermediate branded QSR players, Jubilant’s ability to keep customers ordering directly through its own app is a competitive moat that deserves more credit than it receives.
Centrum frames the competitive picture starkly: Domino’s posted 5% LFL growth “vs -9%/-12% LFL for Pizza Hut of Devyani/Sapphire.” That is not a marginal outperformance. That is a different universe. When your closest category competitors are shrinking by double digits while you grow mid-single digits on a high base, you are not just surviving a tough consumer environment — you are taking share.
Margins: The Inflection Is Here
This is where the quarter gets genuinely interesting. The two concerns heading into Q3 were whether LFL could hold on a high base and whether margins could improve even as LFL moderated from the double-digit levels of earlier quarters. Both were answered.
Standalone EBITDA grew 20% to Rs 4.8 billion. EBITDA margins came in at 19.8% on a reported basis. Centrum highlights that margins expanded 109 basis points year-on-year to 20.5% on their calculation — “the highest in the last seven quarters.” The drivers were a combination of price hikes, operating leverage, lower employee expenses as a percentage of sales, and margin-accretive product launches like sourdough pizza and cheese lava pull-apart.
BOB Capital Markets sees this as the beginning of a trend, noting that “margin recovery is underway, supported by premiumisation, cost efficiencies, and disciplined expansion.” Centrum adds that management “maintains its guidance of driving 200 basis points margin expansion on the FY24 base by FY28E.” The brokerage believes “margins have bottomed out and should see expansion” — a view that, if correct, makes the current stock price look increasingly disconnected from the earnings trajectory.
Gross margins at the standalone level contracted a modest 16 basis points year-on-year to 74.9%. In the QSR world, where input cost volatility regularly swings margins by hundreds of basis points, holding gross margins essentially flat while expanding operating margins is a sign of a business with genuine pricing power and cost discipline.
The Store Machine
Jubilant added 114 new stores during the quarter — 93 Domino’s outlets in India — taking the total network across all brands and countries to 3,594 stores. The pace is notably ahead of the prior year: 220 stores added in the first nine months of FY26 versus 184 in all of FY25. Eleven new cities were added, extending the brand’s reach deeper into India’s smaller towns where organised QSR penetration remains low.
Popeyes, the chicken-focused chain that Jubilant is rolling out in India, posted its third consecutive quarter of double-digit same-store sales growth. BOB Capital Markets highlights “strong traction in the roll-out of Flavour Burst burgers and improving profitability.” The Popeyes network stands at 73 stores — still small, but the unit economics are clearly tracking in the right direction.
The Quiet Contributor
The international business, which was a source of concern after Jubilant’s acquisition of DP Eurasia, is stabilising. In Turkey, Domino’s reported 15% year-on-year revenue growth with 6.3% same-store sales growth adjusted for inflation. BOB Capital Markets notes that the Turkey segment demonstrates “continued profitability and stability post-acquisition.” Sri Lanka and Bangladesh posted 65.9% and 26.6% revenue growth respectively, albeit off small bases.
Centrum observes that “international business growth in Q3 has also been strong,” adding to the picture of a company that is generating broad-based momentum rather than relying on a single geography or brand.
However, BOB Capital Markets maintains a BUY with a target price of Rs 676 based on a sum-of-the-parts methodology — India business at 35x EV/EBITDA pre-Ind AS and DP Eurasia at 35x PE — implying 22% upside from the current price of Rs 554. The brokerage models revenue and EBITDA CAGRs of 7.9% and 8.3% over FY26-28E and describes the business as having “a diversified QSR portfolio” with “visible traction from digital, product, and delivery-led innovations, setting up well for sustained earnings momentum.”
Centrum’s target price of Rs 690, also on a SOTP basis, is marginally higher — assigning 33x EV/EBITDA to the domestic business and 12x to the international business on March 2028 estimates. The brokerage projects a 15.1% revenue CAGR over FY25-28E and expects LFL to hold in the 5-7% range, which “should lead to improved stock performance.” Centrum is direct in its conviction: the stock “has corrected by ~20% over the last one year despite outperforming peers in terms of growth and SSSG despite a challenging demand environment.”
