Jubilant Foodworks bullish about medium-term market potential in India

Jubilant Foodworks, Domino's Pizza master franchisee for Indian operations, has accelerated its pace of network expansion in the country and is bullish about its medium-term market potential in India.

"The company's present assessment of the medium-term market potential in India is 3,000 stores. Accordingly, the company has systematically strengthened its business development capabilities and as a result, has now significantly accelerated the pace of network expansion...," according to the company's latest annual report.

During the financial year 2021-22, Jubilant Foodworks has crossed the 1,500th Domino's store milestone in India, the only Domino's market outside the USA to have achieved this feat, it said.

The company is strategically expanding the restaurant network of Domino's. It added 230 new stores during the financial year ended on March 31, 2022. "The company increases its reach primarily by entering new cities and fortressing its existing markets," it added.

Moreover, during the year, the company achieved a remarkable feat of delivering more than 70 per cent of delivery orders in less than 20 minutes, the company claimed.

Jubilant Foodworks also operates Domino's Pizza stores in countries such as Sri Lanka and Bangladesh.

In Sri Lanka, Domino's delivered its highest-ever system sales with system sales growth of 80.9 per cent and in Bangladesh, it had system sales growth of 50 per cent on the back of delivery growth of 65.9 per cent, the company said.

With four new store openings, the store count has increased to nine in Bangladesh, it added.

On diversity and inclusion, the company said it has opened 17 all-women stores of Domino's in India as of March 31, 2022.

Over its other franchise brand Dunkin', Jubilant Foodworks said it is one of the fastest-growing brands. The brand has renewed focus on beverage growth and a large part of growth is now driven by espresso-based beverages.

The caf market in India is expected to grow at a CAGR (Compound Annual Growth Rate) of 8-10 per cent and is expected to touch Rs 5,000 crore by 2024.

Specialty coffee and tea are one of the fastest-growing categories and hence attract a lot of players, the report said. "Dunkin' coffee pivot will help boost the brand to grow in a bigger category," it added.

Besides, Jubilant Foodworks also brought US Fried Chicken brand Popeyes in India in FY22 and launched its first store in Bengaluru in January 2022. This marks the company's entry into the fast-growing chicken category, it added.

Jubilant Foodworks also has some homegrown brands in its kitty such as Chinese QSR brand Hong's Kitchen and Ekdum, which offers biryanis.

Over the outlook, Jubilant Foodworks said: "While in the near-term, there are heightened challenges, the company believes that the foodservice category is entering an exciting period of sustained growth and market-making."

Secular trends of young population, rising urbanisation, growing affluence, accelerated shifts towards digitalisation and shift in favour of the organised sector, and within that for big, established credible brands will help aid growth of the Foodservice industry.

Jubilant Foodworks' revenue from operation in FY22 was at Rs 4,331.10 crore.