Jubiliant Foodworks Limited

Summary

HSBC Webinar with Jubiliant Foodworks Management Meet Note

Jubiliant Food
Focus on 4 pillar 
- Custormer royalty 
- Tech spend
- Delivery period from 30min to 2min
- Innovations 

News store opening strategy

• The company focusing on new stores expansion which won’t be impact on their p&l cuz before the finalisation of the store the company first read those area where they want to open, three meetings before the finalisation and lastly once it open they focus on 3 more things such  as ROIC, Payback period and EBITDA
• The company prior to focus on revenue they have a first priority to be check on Costs where they see RM, petrol, store maintenance, wages etc. as they try to control such things first to maintain the profitability.
  • wanted to make a pizza as like as samosa and pau bhaji where their pizza will affordable and even to maintain the taste.
  • Hence, they had launched royalty program Cheesy reward and 7 month of inception this program has given a 1.5mn downloads.
• Competitive advantages is still intact. The launch of ₹49 pizza the company still able to maintain their gross margin and for that they have a solid backend such as process of sourcing, process of conversion and forward logistic from their and this gives them a confidence to maintain such things even if they open a new stores.

The company process the material from in house where they don’t use artificial Color, preservatives. 

The management is very much clear on their sources of the material, out sourcing and the building and thus, gives them a confident to maintain the near term challenges and maintain their competitive advantage.

20 min delivery

• Where the management having a strategy to give Tasty pizza, loyalty, value for money and fastest delivery to consumers
• This strategy has applied only 7-8 top cities where the company have a strong network.
• Management said that these will become a competitive advantage for the company going ahead.
• The management applied this 20min strategy where consumer wanted such things as this is vary mostly in metro cities whereas in tier 3-4 cities consumer take their family to the restaurant and dine in. So if consumer want this the company will apply the same those cities also.

Popoye

• The opportunity is great in this space.
• The company manages the taste of the non veg consumers through the quality of chickens, processing of RM and locations where they had opened till now.
• Wherever the company had opened their popoye store the response was tremendous and the mgt look forward to open 250 stores of the same.
• In Chicken less in demand and more in supply as this space has a less crowded than pizza and therefore the company opening their stores slowly and gradually.
• The  margin in this category is different than pizza and mgt expecting the higher margin going ahead once the they build the competitive edge as like as dominos.

Opportunity size

• Food Industry is a $45bn out of which $4.5bn is only QSR. So there is a huge headroom for growth.
• Per capita income is highest in the world in US and hence, inspite of that US dominos is still growing.
• So India we are very less as there is value for money, menus according to the consumers, right Capex scale, stores opening up, excellence delivery, so there is a huge headroom.
• The company have a 12mn active users monthly and if include swiggy, Zomato then it is a 150mn users

Hongs kitchen
The strategy behind this start only as in chicken there is a brand KFC but in the Chainese cuisine there is no home brand and the mgt is working this phase a like a startup so before go beyond level they will look into the customer response, taste etc.

Capital allocation
The company have already tech investment, commissionaires in Banglore and Mumbai after that. So there is big Capex in commissionaires before the international expansion.

Competiton
The focus on footfalls first before revenue and whenever any other QSR come across the store their strategy to catch up rhe consumers is going now. 

For e.g. food court in mall there are many others QSRs too but dominos has a more footfalls than others.

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About The Company

Jubilant FoodWorks Limited is India’s largest foodservice company and is part of the Jubilant Bhartia Group. Incorporated in 1995, the Company holds the exclusive master franchise rights from Domino’s Pizza Inc. to develop and operate the Domino’s Pizza brand in India, Sri Lanka, Bangladesh and Nepal. In India, it has a strong and extensive network of 1,760 Domino’s restaurants across 387 cities. In Sri Lanka and Bangladesh, the Company operates through its 100% owned subsidiary which currently has 47 and 13 restaurants respectively. Jubilant FoodWorks also enjoys exclusive rights to develop and operate Dunkin’ restaurants in India and Popeyes restaurants in India, Bangladesh, Nepal and Bhutan. The Company currently operates 24 Dunkin’ restaurants across 8 Indian cities and 12 Popeyes restaurants in Bengaluru.

In 2019, Jubilant FoodWorks launched its first owned-restaurant brand ‘Hong’s Kitchen’ in the Chinese cuisine segment which now has 12 restaurants across 4 cities. In 2020, the Company launched Ekdum! another new restaurant brand that serves biryani. Ekdum! has 6 restaurants across 3 cities. The Company has also forayed into the ready-tocook segment with its ‘ChefBoss’ range of sauces, gravies and pastes.

Business Segment

Domino's:

Since 1996, the Company has the exclusive rights to develop and operate Domino's Pizza Restaurants in India. It is the largest franchisee of Domino's brand outside the USA. It has also been granted exclusive rights of domino's brand for Sri Lanka, Bangladesh & Nepal.

It operates its Sri Lanka business through its wholly-owned subsidiary Jubilant Foodwords Lanka Pvt Ltd and it operates its business in Bangladesh through Jubilant Golden Harvest Ltd which is a JV between Jubilant & Golden Harvest Group of Bangladesh.

Popeye's

As on March 2021, Company entered into a Master Franchise and Development Agreement with PLK APAC Pte. Ltd., a subsidiary of Restaurant Brands International Inc.,to develop, establish, own and operate, and to license Franchisees to develop, establish, own and operate, Popeyes® Restaurants in India, Bangladesh, Nepal and Bhutan.

New Business

JFL is focused on scaling up its other brands and paving its way across various cuisines.

In 2012, the company acquired master franchise rights for Dunkin' Donuts brand in India which serves a wide variety of donuts, coffee, beverages, sandwiches, and other goods. It also launched two of its own brands Hong's Kitchen & Chef Boss recently which are in the business of Chinese cuisine and FMCG respectively.

Financial Highlights

Source of the webinar link:

https://youtu.be/q3LwZAntKB4