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Jubilant FoodWorks Limited (JFL)
Monthly Coverage Report
December, 2017
Submitted By:
Perfect Relations
Media Coverage Index
Date Publication Headline Media
04/12/2017 The Economic Times Burger King Sales Grow 69% Even as
Industry Stagnates Print
06/12/2017 The Economic Times Higher Prices on Menu at QSRs Print
13/12/2017 The Economic Times
(Brand Equity) BACK TO DONUTS Print
13/12/2017 The Economic Times
(Brand Equity) DOMINO'S RELOADED Print
17/12/2017 The Economic Times The Bun has got Bigger Print
26/12/2017 Financial Express (Brand Wagon)
Beyond the GST smokescreen Print
12/12/2017 Financial Express (Brand Wagon)
How the F&B sector is courting the social crowd
05/12/2017 The Economic Times
(Hindi)
Burger King sales grow, even as industry
stagnates Print
06/12/2017 The Economic Times
(Hindi) Quick service restaurant have increased
their prices on menu Print
06/12/2017 The Economic Times
(Gujarati) Quick service restaurant have increased
their prices on menu Print
22/12/2017 Images Retail TRRAIN RETAIL AWARDS 2016-17 RETAIL
CHAMPIONS Print
25/12/2017 Navshakti
Jubilant Food celebrates Christmas by treating over 2,300 underprivileged
children in Delhi and Mumbai with a pizza meal
04/12/2017 The Economic Times Burger King Sales Grow 69% Even as
Industry Stagnates Online
06/12/2017 The Economic Times
Why despite GST cut, eating out at
McDonald’s, Burger King, KFC, Pizza Hut &
Domino's has not become cheaper
Online
17/12/2017 The Economic Times The resurgence of India's fast food
industry Online
27/12/2017 CIO & Leader.com Anand Thakur Joins Jubilant Foodworks
As CDO Online
25/12/2017 The CSR Journal The Joy Of Gifting During Christmas Online
PRINT COVERAGE
Title Burger King Sales Grow 69% Even as Industry Stagnates
Publication The Economic Times
Edition Chennai, Mumbai, Delhi, Hyderabad, Chandigarh, Ahmedabad, Pune, Jaipur and Bangalore
Date 04/12/2017
Title Higher Prices on Menu at QSRs
Publication The Economic Times
Edition Kolkata, Mumbai, Ahmedabad, Bangalore, Delhi and Jaipur
Date 06/12/2017
Title BACK TO DONUTS
Publication The Economic Times (Brand Equity)
Edition Chandigarh, Hyderabad, Chennai, Kolkata, Bangalore, Ahmedabad, Jaipur, Pune, Delhi, Bhubaneshwar and Mumbai
Date 13/12/2017
Title DOMINO'S RELOADED
Publication The Economic Times (Brand Equity)
Edition Chandigarh, Hyderabad, Chennai, Kolkata, Bangalore, Ahmedabad, Jaipur, Pune, Delhi, Bhubaneshwar and Mumbai
Date 13/12/2017
Title The Bun has got Bigger
Publication The Economic Times
Edition Chandigarh, Hyderabad, Chennai, Kolkata, Bangalore, Ahmedabad, Jaipur, Pune, Delhi and Mumbai
Date 17/12/2017
Title Beyond the GST smokescreen
Publication Financial Express (Brand Wagon)
Edition Chennai, Kochi, Pune, Mumbai, Hyderabad, Bhubaneshwar, Kolkata, Jaipur Delhi, Lucknow, Dehradun, Ahmedabad, Bangalore and Chandigarh
Date 26/12/2017
Title How the F&B sector is courting the social crowd
Publication Financial Express (Brand Wagon)
Edition Hyderabad, Dehradun, Ahmedabad, Mumbai, Lucknow, Pune, Delhi, Kochi, Jaipur, Chennai, Kolkata, Chandigarh, Bhubaneshwar and Bangalore
Date 12/12/2017
Title Burger King sales grow, even as industry stagnates
Publication The Economic Times (Hindi)
Edition Delhi
Date 05/12/2017
Title Quick service restaurant have increased their prices on menu
Publication The Economic Times (Hindi)
Edition Delhi
Date 06/12/2017
Title Quick service restaurant have increased their prices on menu
Publication The Economic Times (Gujarati)
Edition Mumbai
Date 06/12/2017
Title TRRAIN RETAIL AWARDS 2016-17 RETAIL CHAMPIONS
Publication Images Retail
Edition National
Date 22/12/2017
Title Jubilant Food celebrates Christmas by treating over 2,300 underprivileged children in Delhi and Mumbai with a pizza meal
Publication Navshakti
Edition Mumbai
Date 25/12/2017
ONLINE COVERAGE
Burger King Sales Grow 69% Even as Industry Stagnates
American fast-food chain Burger King, in the second year of its India operations, grew 69% to post sales
of Rs 237 crore during FY17 when most quick-service restaurants were struggling with stagnant sales. In
the 2016-17 fiscal, the company generated average sales of Rs 2.7 crore from each of its 88 outlets
Title Burger King Sales Grow 69% Even as Industry Stagnates
Web portal The Economic Times
Date 04/12/2017
Link
https://economictimes.indiatimes.com/industry/cons-products/food/burger-king-sales-grow-69-even-as-industry-stagnates/articleshow/61908203.cms
opened till March, while its rival Westlife Development, that runs McDonald’s in the south and west,
posted average sales of Rs 3.6 crore from each outlet. Burger King, however, notched up higher numbers
than Jubilant FoodWorks (JFL), where average sales per outlet were at Rs 2.1 crore from both brands,
Domino’s Pizza and Dunkin’ Donuts.
Burger King’s losses rose to Rs 62 crore during last fiscal, compared with Rs 38 crore a year ago, as the
company doubled its store count. Burger King, that now runs more than 100 stores in India, claims it is
now profitable at both the store and company level. “Our restaurant EBIDTA (earnings before interest,
taxes, depreciation, and amortisation) has been positive since last July,” said Rajeev Varman, CEO,
Burger King India. “Sales grew mainly due to three reasons — all our burgers are grilled similar to an
Indian-stye tandoor which is healthy, our focus on entrylevel pricing, and we offer the largest vegetarian
menu within QSR.”
Burger King, that is popular for its Whopper burger, entered India in November 2014 when most quick-
service restaurants were struggling with falling sales. There was a slight revival last fiscal but the overall
market continued to face challenges, compounded further by demonetisation announced in November
last year which saw consumers reduce discretionary spending. The 65-year-old burger chain partnered
Everstone Capital in India, which holds a majority stake in the company through subsidiary F&B Asia
Venture.
It has lined up $100 million for expansion over the next few years and expects to open at least 40-45
restaurants in India in the next few years. “There’s a significant room to grow as the potential in each of
the 28 cities where we are present remains high,” said Varman. Leading quick-service restaurants have
seen low same-store sales growth (SSG) since the past two years with consumers cutting back on
discretionary spending.
In addition, the segment also saw the entry of global companies including Wendy’s and Johnny Rockets,
offering customers a wider cuisine range. For instance, Westlife Development grew SSG at 4% while
Jubilant saw a 2.4% decline in SSG last fiscal. Starbucks, the world’s largest coffee retailer, posted its
slowest sales growth of 14% in India last year.
Why despite GST cut, eating out at McDonald’s, Burger King, KFC, Pizza Hut & Domino's has
not become cheaper
Prices at McDonald's (in the north and east), Burger King, Pizza Hut, Domino's and KFC have risen in the
past week — at least on some of the costlier items on the menu — despite a cut in goods and services
tax (GST) on restaurants because input tax credit is no longer available to them. On the other hand, the
quick service restaurant (QSR) chains said some items are now cheaper thanks to the tax reduction. The
GST Council slashed rates to 5% from 18% for restaurants with effect from November 15.
Title Why despite GST cut, eating out at McDonald’s, Burger King, KFC, Pizza Hut & Domino's has not become cheaper
Web portal The Economic Times
Date 06/12/2017
Link
https://economictimes.indiatimes.com/industry/cons-products/food/prices-go-up-on-menus-at-qsrs-despite-cut-in-gst/articleshow/61938691.cms
Increases at McDonald's (north and east), Burger King, Pizza Hut, Domino's range from 5% to 8%, while
KFC said the rise in price was marginal. This comes as the government has been pushing companies to
pass on the benefit of the mid-November GST cuts on various items to lower prices for consumers.
Connaught Plaza Restaurants Ltd (CPRL) managing director Vikram Bakshi said, "The actual impact of
non-availability of input taxes after reduction of GST to 5% from 18% was about 8%." CPRL continues to
operate McDonald's stores in the north and east despite the US chain announcing the termination of its
franchisee pact for 169 stores in the region in August.
"After careful deliberation, CPRL has increased prices, effective December 1, to give us an overall 5%
increase," Bakshi said, adding that the breakfast menu and all beverages are unchanged as are items
such as the Pizza McPuff.
'Increase in Input Cost'
Domino's has raised prices of cakes, garlic bread and some highend pizzas by up to 8% but kept regular
pizzas unchanged.
"Since denial of input tax credit has led to an increase in the input cost, we have adjusted prices of a few
items to only partially cover this increased cost. However, our customers will now witness a significant
reduction in effective prices immediately," a Jubilant FoodWorks spokesperson said.
The spokesperson said Pizza Mania prices have been cut to Rs 62 from Rs 69, while the basic Margherita
is down to Rs 104 from Rs 117. Under its Everyday Value Offer, pizza prices have been reduced to Rs 209
from Rs 235.
KFC has raised the price of some items and cut that of others. KFC India managing director Rahul Shinde
said, "Our menu prices have been updated to be inclusive of GST, and going forward our consumers will
pay exactly what they see on the menu board."
A spokesperson for Hardcastle Restaurants, which operates McDonald's outlets in the west and south,
said there had been no increase in prices over the past week. "The government has brought down GST
from 18% to 5%, but there has been a removal of input tax credit due to which our operating costs have
gone up. We have passed on benefits to consumers wherever we could," said a Hardcastle spokesperson,
adding that it has "'substantially reduced prices" of flagship products including the Maharaja Mac and
spicy chicken and paneer wraps.
"Depending on the category of the restaurant, price adjustment exercise to the base menu price had to
be done to rationalise the removal of ITC," said Rahul Singh, president of the National Restaurants
Association of India (NRAI), which represents thousands of outlets. "We welcome reduction in GST slab
from a very high 18% to 5% without any distinction of the air-conditioning. However, denying the ITC
benefit goes against the grain of GST and will push up the costs by 10%, which will be passed on the
menu price. So, effectively the consumer pocket will get a marginal benefit and not as it seems."
A Tata Starbucks spokesperson said, "Like many businesses operating in India, Tata Starbucks adjusted
prices following the recent revision of the GST structure. The GST revision included the elimination of the
input tax credit, increasing costs for the industry. As a result, we raised our base prices, while still
providing savings for our customers after tax on every product."
The chief executive of a large global restaurant chain's India unit said, "While there is a decrease in
prices of some value products, the absence of input tax credit (ITC) has led us to take selective price
hikes." He said it was not possible to pass on all of the tax benefit. "For some popular products, we have
maintained prices so that it doesn't impact consumer sales."
Burger King and Pizza Hut didn't respond to queries.
At last month's GST Council meeting, the rate was slashed to 5% from 18% for all standalone
restaurants, irrespective of whether they were air-conditioned or otherwise, without input tax credit.
Takeaways and deliveries were also brought down to a flat slab of 5%. The change took effect November
15.
The resurgence of India's fast food industry
India's quick service restaurant (QSR) business was floundering after body blows from demonetisation,
the ban on liquor sales on highways and the introduction of the goods and services tax (GST). Hundreds
of QSR and cafe outlets shut between 2013 and 2016 through the reckless expansion of 2015. Now, they
have bounced back, galvanised by the unexpected challenges. Smaller stores, more food innovations,
moving out of high streets and greater focus on same-store sales growth (SSG) are driving a resurgence.
Title The resurgence of India's fast food industry
Web portal The Economic Times
Date 17/12/2017
Link
https://economictimes.indiatimes.com/industry/services/hotels-/-restaurants/the-resurgence-of-indias-fast-food-industry/articleshow/62098915.cms
For Domino's, the bellwether of QSR industry, 2017 started on a grim note: SSG dived into negative
territory of 3.2 per cent from a positive of 4.6 per cent for the year-ago quarter — a first in six
consecutive quarters of low but positive SSG.
Despite a bounce-back in the second quarter for India's largest pizza brand, posting a positive SSG of 4.2
per cent, the recovery was tenuous. The pizza, and the larger QSR story, it seemed, were to be sliced
asunder.
However, for the first two quarters of fiscal 2018, Domino's made a comeback to positive 6.5 per cent
and 5.5 per cent SSG(see Same-store Sales Growth has Picked Up in Most Chains). Profit after tax (PAT)
of Jubilant FoodWorks, the master franchisee of American pizza brand Domino's and donut label Dunkin'
Donuts, leapfrogged from a meagre `6.72 crore in March 2017 to Rs 48.5 crore.
"The worst is behind us," says Pratik Pota, chief executive officer of Jubilant FoodWorks. The green
shoots of recovery in consumer sentiments and discretionary spends are definitely visible. "We are
optimistic."
Westlife Development, which operates McDonald's restaurants in western and southern India, similarly
saw a stronger September quarter on the back of higher SSG at 8.4 per cent from 1.7 per cent of Q2
2016, making it nine consecutive quarters of same-store sales growth.
"Even after demonetisation, which sucked liquidity out of the system, we reported positive same-store
sales growth at 5.1 per cent in that quarter," Amit Jatia, vice-chairman of Westlife Development, told ET
Magazine. Innovation in menu, brand extensions and launch of value-for-money products such as Happy
Price Combo and Chatpata Naan were the key factors driving growth, adds Jatia.
KFC India, the local arm of the American burger giant, has seen five consecutive quarters of positive
system sales growth. Mad Over Donuts, the largest donut player in terms of store count, also reported an
upswing in SSG, averaging 14 per cent over the last three quarters.
"I am quite bullish on QSR's long-term growth potential," says Tarak Bhattacharya, chief operating officer
of Singapore-based Mad Over Donuts. Sales are up for the past six quarters, consumer sentiment has
been improving and there has been a remarkable uptick in SSG. "QSR is back on track," says
Bhattacharya.
SSG is the best financial metric to check the health of a QSR company as it shows a difference in revenue
generated by a chain's outlets over a certain period, often a quarter, as compared with an identical
period last year.
If the bulk of a company's revenue increase comes from opening new stores, it could be that the demand
for a company's product is flattening out and that it will plateau once the company reaches a saturation
point in terms of total locations. That's why a positive SSG shows the strong business fundamentals of a
company. Though a company can still grow with low SSG by opening more outlets, that's a recipe for
disaster as it entails heavy capital expenditure.
Profitability Mode
Domino's opened 47 stores in the last quarter of FY2014.
The SSG number for the corresponding quarter stood at a negative of 3.4 per cent. In the second quarter
of FY15, it opened 36 stores, and had a negative SSG of 5.3 per cent. Now, contrast it with the second
quarter of this fiscal: one store opened, one closed and a positive SSG of 5.5 per cent. For the last three
quarters, Domino's has not expanded its footprint of 264 Indian cities.
"Domino's is still chasing growth, but of a different kind, ie, same-stores sales," grins Pota of Jubilant. It
is easy to open more stores and get aggregate growth, but if that is not built on strong same-store sales
growth, it weakens profitability. "We are hungry for driving sustainable profitable growth, but not at the
cost of low or negative same-store sales."
QSR players have pressed the brakes after the reckless expansion of two years starting 2015. The idea of
sustainable growth had taken a back seat. Over 650 QSR and cafe outlets shut down between 2013 and
2016, according to a study done by TagTaste, an online community for food professionals to discover,
network and collaborate.
The study exposed the flimsy operational metrics. Over 45 per cent of the QSR and cafe players had a
negative EBITDA (earnings before interest, tax, depreciation and amortisation).
"QSR expanded at a hectic pace," reckons Abneesh Roy, senior vice-president, institutional equities,
Edelweiss Securities, resulting in cannibalisation of the same brand stores and shrinking bottom line.
"Caution was thrown out of the window and SSG seemed to be a lost word in business lexicon," he adds.
What compounded the problem was back-to-back blows: demonetisation and rollout of GST.
"Demonetisation and GST took the industry by surprise," says Rahul Shinde, managing director of KFC
India. While ups and downs are part of the business cycle, Shinde explains, 2016 turned out to be a
turnaround year for KFC, which brought the focus back on chicken as its main offering.
"KFC posted five consecutive quarters of positive system sales growth," Shinde said, adding that the
brand went back to the drawing board, made a new strategy and decided to bring chicken to the
forefront. "As we made this transition, consumers returned to the restaurants," he says.
QSR players flirted with innovations in offerings which had nothing to do with the core business in 2015-
16. Dunkin' Donuts was pushing burgers, Domino's was betting big on side dishes and Barcelos was
trying out more Western cuisines.
"We quickly rejig our plans," says Rohit Malhotra, business head of Barcelos India, a South African casual
dining restaurant chain that entered the country in early 2015. Smaller stores, more food innovations
catering to local palate and moving out of high streets came into reckoning. Three years after entry,
Barcelos has shifted one store, opened one, two more will be opened next month.
"Demonetisation, highway liquor ban and initial blow of GST are things of the past," says Malhotra.
Things have turned positive over the last few months. Footfalls and sales are back on track, and
consumer sentiment has improved.
"From a macro perspective, we believe consumer sentiment is steadily improving," says Amit Jatia, vice-
chairman of Westlife Development. While the brand will strengthen menu innovation, brand extensions
will continue to be the corner stone of growth. For the last couple of quarters, he points out, everybody's
results are moving in the right trajectory.
"So clearly, QSR is kind of turning around." It's not only international chains that are looking at
innovations to drive growth. Mirah Hospitality, which runs flagship restaurant Khandani Rajdhani, serving
Gujarati and Rajasthani cuisine, has focused on introducing combos and packed meals through various
delivery platforms.
"This year is better than last year and the brand has performed well even in the midst of challenges,"
says Aji Nair, chief operating officer, F&B division, Mirah Hospitality.
With GST firmly in place and GDP looking to grow at a healthy pace, there is no reason to believe that
the food sector won't keep up the pace next year, says Nair. Suresh Goel, chief executive officer of
Bikanervala, which sells the Bikano brand of Indian sweets and savouries, also predicts a brighter
prospect for the food industry. "Any business is cyclical in nature. In QSR, there have been some
slippages but now it's gaining momentum," says Goel, adding that food services market is projected to
touch `5 lakh crore mark by 2021. "There is enough room for growth, and economy is resilient," he adds.
In the July-September quarter, economic growth bounced back to 6.3%, reversing a five-quarter
slowdown, according to data by Central Statistics Office (CSO). Economic growth picked up from a three-
year low of 5.7% in the April-June quarter, CSO said in its data released end of November.
Conscious Sentiments
Earlier this week, the United Nations World Economic Situation and Prospects 2018 estimated India will
grow at 7.2% in 2018 and accelerate to 7.4% in the following year on robust private consumption, public
investment and structural reforms, though the risk of sudden capital withdrawal on account of monetary
policy normalisation in developed countries remained. An uptick in consumer sentiment and improving
GDP is what the doctor ordered for an ailing food industry overwhelmingly dependent on discretionary
spend.
Consumer confidence in India rose to a 10-year high in the December quarter of last year, according to
Nielsen's global consumer confidence index report released in February this year. India retained its No. 1
spot among the 63 countries surveyed. In fact, India scored the top spot in Nielsen's survey for eight
consecutive quarters until June last year. "Consumer sentiment has seen an uptick, and it is likely to
improve over the next year," says Roy of Edelweiss Securities. Food inflation has been low, modern retail
has been posting healthy numbers, and GST slashed to 5% from 18% will only aid the revival underway.
Roy said the QSR industry suffered over the last two years owing to massive discounts by food
aggregating apps, freebies doled out by biggies such as Domino's that liberally promoted BOGO (buy one
get one free) and sharp price hike by fast food brands. "The growth tailwinds will continue next year,"
contends Roy.
In spite of the early signs of revival, food entrepreneurs are careful to temper their optimism. Getting
government approvals, permissions and overall rules and regulations governing the F&B industry continue
to be a big constraint, says Amit Burman, chairman of Lite Bite Foods, which runs 180 restaurant stores,
including Punjab Grill and Street Foods.
"However, all negative effects have now trickled down and we are closing the year on a good note,"
Burman says. The positive sentiment from the consumers has been a silver lining no matter how
challenging the environment is, he says.
Food analysts caution that QSR might hit speed breakers if fundamental issues are not resolved. Though
the QSR industry has managed to hold on to its appeal to millennials and the older generations, globally
carbonated soft drinks contribute 25-30% of the business level gross margin and this does not include
pouring charges and the advertising support that Coke and Pepsi dole out.
"With preferences for soft drinks continuing to decline in India, the QSR industry is likely to come under
even more pressure in the coming years," says Jaspal Sabharwal, a food industry veteran and cofounder
of TagTaste.
Minimum wage plus hiring-to-retention costs in the top eight cities are rising more than revenue growth,
and this is impacting industry's profitability by 50-60 basis points annually, says Sabharwal. Even after
taking into account that 10-12% of the revenue comes from the delivery business, in-store dining
productivity is declining at an average rate of 4% year-on-year since 2014. Consumers' desire for
healthier food and smaller portions has led to heightened volatility. Generation-Z (people born in or after
2000) is not looking at QSRs favourably and there are 260 million of them in India. "The QSR legacy is
under pressure and it is happening globally," says Sabharwal.
Pota of Jubilant, for his part, sounds confident about the growth prospects. The growth will be
sustainable, based on fundamentals and food innovations. "We have cut discounts, have turned frugal
and more cautious about opening our stores." The dough is rising.
Anand Thakur Joins Jubilant Foodworks As CDO
Anand Thakur has joined as the Chief Digital Officer of Jubilant Foodworks Ltd. This is a newly created
position at the company. A techie, Thakur served in various IT companies including Infosys, Perot
Systems, Adobe before having a stint in online retail companies including Lenskart and Koovs. His
immediate last assignment was as the CTO of Koovs. It may be noted here that more and more
companies are appointing CDOs and the post is seeing executives with diverse backgrounds - technology,
marketing, core business and supply chain.
Title Anand Thakur Joins Jubilant Foodworks As CDO
Web portal CIO & Leader.com
Date 27/12/2017
Link
http://www.cioandleader.com/article/2017/12/26/anand-thakur-joins-jubilant-foodworks-cdo
The Joy Of Gifting During Christmas
In the true spirit of bringing cheer, which is really the cornerstone of Christmas celebrations, various
corporates went out of their way to spread joy, especially amongst children.
SMAAASH hosted a Christmas party for the children of Muskaan Foundation, a NGO dedicated to the
people having multiple disabilities.
Smiling faces were witnessed at the cannon shooting, ball pool, creative slides and at the other activities
present. The little ones of the foundation were also treated to some delicious goodies and sweets.
Title The Joy Of Gifting During Christmas
Web portal The CSR Journal
Date 25/12/2017
Link http://thecsrjournal.in/joy-gifting-christmas/
Jubilant FoodWorks Limited (JFL), master franchise of Domino’s Pizza and Dunkin’ Donuts in India, made
this Christmas special for underprivileged children by organising a delicious pizza treat for them. As part
of the Christmas celebrations, JFL employees also organised special activities for children that doubled
the joy of festivities for them.
The activity was carried out in Delhi and Mumbai and around 2300 children were part of the celebrations.
It was organised in partnership with various NGOs in the cities. The employees spent quality time with
the children understanding their aspirations and engaging them in fun filled activities thus spreading the
Xmas spirit and fervour.
Santa Claus too is in the city in an initiative by 1 SmallStep Foundation to bring the joyfulness among
young and old, rich and poor, bold and beautiful at Marine Drive, Kemps Corner, Churchgate, Dadar,
Mahim, Bandra, Chembur, Ghatkopar, Sion, Matunga, Andheri, Thane, Powai, Malad, Kandavali .
The idea of giving back to the society has been embraced by 15 Santa’s who are volunteering to paint
the city red, and also have Nitasha Biswas, India’s first Miss Trans Queen will spread Christmas happiness
in Delhi.
Via social media crowdfunding kindness has been gathered by people who have generously filled Santa
bags with chocolates, cookies, muffins, biscuits, cakes, stationary such as crayons, drawing books, fancy
pens & pencils, shawls & blankets to the elderly.
It is this occasion that celebrates happiness, gifts, love and much more. In our own small way, each of us
can be a Santa and gift a better tomorrow to the underprivileged and less fortunate than us.
Thank you for reading the story until the very end. We appreciate the time you have given us. In
addition, your thoughts and inputs will genuinely make a difference to us. Please do drop in a line and
help us do better.
