Stock Upgrades: CLSA says a 30% fall in two QSR names prices in near-term concerns

Brokerage firm CLSA has upgraded Jubilant FoodWorks to 'Hold' from 'Underperform', assigning a price target of ₹477 per share. The brokerage has also raised its rating on Westlife Foodworld to 'Hold' from 'Underperform', with a target price of ₹500.

Both stocks have seen sharp underperformance over the past year, with Jubilant and Westlife down 29% and 33%, respectively.

CLSA said it remains cautious on near-term sales per store growth for Jubilant, citing a tough base and elevated competitive intensity.

However, it believes the expected slowdown in sales per store growth is now largely priced into the stock.

In the case of Westlife Foodworld, CLSA mentioned that the stock is trading at a 22% discount to its long term average EV/Ebitda multiple.

According to the brokerage, current valuations already factor in higher competitive intensity in the burger segment.

Shares of Jubilant FoodWorks ended Thursday's session 1.09% lower at ₹488.25, while Westlife Foodworld closed 2.71% lower at ₹480.90.