Jubilant Food. (JUBLFOOD)

FairStock Score: 37/100 — MIXED

Score breakdown: P/E: 0/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1

Key Financials

Strengths

• Revenue growth of 20.09% and 5-year revenue CAGR of 19.71% show strong consumer demand and scalability.
• Piotroski F-Score of 8/9 and Altman Z-Score of 4.48 indicate solid operating health and low bankruptcy risk.
• Free cash flow of ₹818 Cr and ROE of 18.87% demonstrate cash generation and reasonable return on equity.
• Promoter holding of 40.27% aligns management with minority shareholders.

Concerns

• Profit growth of 7.14% lags revenue growth of 20.09%, implying margin compression.
• Valuation is extreme: P/E of 103.64, EV/EBITDA of 169.05, and PEG of 15.74 leave little room for error.
• Graham Number of ₹65.64 against price of ₹492.65 shows a negative margin of safety from a value perspective.
• Debt/Equity of 2.11 is high, and ROCE of 13.08% is below ROE due to leverage.

AI Analysis

As a buyer of businesses, not tickers, I start by asking whether the enterprise earns high returns on capital and can sustain them. Jubilant Food has grown revenue at roughly 20% recently and 19.71% over five years, so demand for its restaurants is real. Yet profit grew only 7.14%, and the latest quarter's ₹73 crore profit on ₹2,437 crore sales implies a thin net margin. ROE of 18.87% looks fine, but ROCE of 13.08% with debt/equity of 2.11 tells me leverage is doing some of the work. The Piotroski score of 8/9 and Altman Z-Score of 4.48 show the business is not financially distressed, and free cash flow of ₹818 crore gives it room to reinvest. Still, this is not a Benjamin Graham bargain. Book value is ₹31.87, and Graham Number is ₹65.64; at ₹492.65, I am being asked to pay 103.64 times earnings, 15.46 times book, and 169.05 times EV/EBITDA. Even the DCF value of ₹663.61 does not give me the margin of safety I need, especially with a PEG of 15.74. The dividend yield of 0.23% offers no reward while waiting. Promoter holding of 40.27% is encouraging, but the high debt and valuation demand discipline. Restaurants are a decent business when costs are controlled, but this market price already assumes flawless execution for many years. If revenue growth continues at 20% and margins expand, the stock could do well; if inflation or competition squeezes margins further, the high multiple leaves no cushion. I would wait for a much lower price and clearer evidence that profit growth can catch up with sales growth. A wonderful business can still be a poor investment at the wrong price.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer