Jubilant FoodWorks Limited (NSE: JUBLFOOD) Q3 2026 Earnings Call dated Feb. 10, 2026
Corporate Participants:
Apar Saraswat — Lead – Investor Relations
Hari S. Bhartia — Co-Chairman
Sameer Khetarpal — CEO and MD
Suman Hegde — CFO
Analysts:
Vivek Maheshwari — Analyst
Manoj Menon — Analyst
Nihal Mahesh Jham — Analyst
Ashish Kanodia — Analyst
Manish Poddar — Analyst
Amit Sachdeva — Analyst
Aditya Soman — Analyst
Jay Doshi — Analyst
Presentation:
operator
Ladies and Gentlemen, good day and welcome to the Q3FY26 earnings conference call hosted by Jubilant Food Works Ltd. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the call, please signal an operator by pressing Star then zero on your touchstone phone. I now hand the conference over to Mr. Apar Saraswat from Jubilant Foodworks. Thank you. And over to you sir.
Apar Saraswat — Lead – Investor Relations
Thank you so much. Rayo welcome to Jubilant Food Works Quarter 3 FY26 Earnings Call for investors and Analysts we are joined today by senior members of the management team in including our chairman Mr. Shah Bhatia, our co chairman Mr. Hari Bhatia, our CEO and MD Mr. Sameer Ketarpal, our Turkey business CEO Mr. Arfnan Saranga and our CFO Ms. Suman Hegri. We will commence with key thoughts from the Chairman followed by remarks from CEO and mds. After the opening remarks the forum will be open for Q and A session. A cautionary note before we move ahead.
Some of the statements made on today’s call would be forward looking in nature and the actual results could vary from such statements. We will also host the replay and transcript of the call on the company’s website under the Investigation section. I would now like to invite Mr. Hari Bhatia to share his views. Over to you Sir.
Hari S. Bhartia — Co-Chairman
Thank you Apar Good evening everyone and thank you for joining us today on our quarter three FY26 earnings call. We are happy to share that our overall performance in the third quarter of FY26 was strong highlighted by 13.3% growth in revenue and a solid 20% rise in reported EBITDA. Our business in India maintained its double digit year on year growth and the EBITDA margin improved by 109 basis points compared to the same period last year. Domino’s India achieved positive LFL growth for the eighth quarter in a row. Popeye also saw an impressive double digit LFL growth indicating strong brand acceptance and high customer repeats.
The Turkey business continue to give positive results. It gives us immense pleasure to share with you that along with strong revenue growth and pat, the business is generating steady cash flows and over the last couple of quarters have been paying dividends to service JFL’s acquisition debt obligations. Our international business in Sri Lanka and Bangladesh also reported impressive top line growth and improvement in bottom line. We carried on our network expansion by adding 114 stores during the quarter across brands and markets. We now operate close to 3,600 stores out of which approximately 2,530 stores are in India.
On the menu innovation front we are really excited with the pace of innovation and the new product positionings being offered to our customers across our brands. The customer response to the new products over the last 12 months have been very encouraging. Going forward we remain focused on delivering value to our customers. This has been possible because of strong foundation that we have built with technology, supply chain delivery capability and most importantly our people. Our focus behind the same will remain relentless and these are key to our long term success with that. Now I invite Sameer to provide you with further insights into our Quarter 3 FY26 performance.
Sameer Khetarpal — CEO and MD
Thank you Mr. Bhartia and good evening to everyone. Q3 FY 2026 was a proof point quarter for us. Strategy is working. Our technology and investments in AI are delivering impact and execution was rock solid. Q3 is our peak quarter and the ultimate stress test for the organization. Across operations, supply chain technology and other functions, our store teams and delivery riders handled exceptionally high order volume with speed and consistency, demonstrating operational discipline at scale. I’m extremely proud and thankful to to the team’s performance. Turning to financial performance, during the quarter we reported consolidated revenue of rupees 24.4 billion representing a growth of 13.3% year on year.
Importantly, all our business segments, both domestic and international contributed to top line growth. India revenue stood at 18 billion growing at 11.8%. YoY Domino’s India delivered a like for like growth of 5% on a strong base of 12.5%. Like for like growth in the same quarter like for like which was the growth in the same quarter last year. Revenue grew 10.7% year on year for Domino’s driven by healthy order growth of 10%. During the quarter we undertook calibrated price increases on select products to strengthen margins and incentivize favorable mix movements. Our recent new product launches including sourdough pizzas and cheese Lava Pull Apart have seen an overwhelming response and have scaled rapidly in a short period.
Also, these products are accretive to gross margin. Domino’s in India added approximately 200 new stores over the first nine months of the fiscal year and 75 stores in Q3 alone. This is the highest ever store expansion by Domino’s in India in the first nine months of the year. Popoise continued its strong momentum delivering high double digit LFL growth for the second consecutive quarter. We rolled out the range of seven flavor bus burgers we topped it up with a 15 piece chicken bucket that has also received an excellent response. Popoise store expansion expanded to 73 stores adding five stores in the quarter.
We are now increasingly confident about Popoise emerging as a powerful new growth vector for the company. There are handsome gains on the margin front. Gross margin in India business delivered a sequential expansion of 52 basis point to 74.9% translating into a 80 basis point improvement over last six months. The improvement has been achieved despite persistent inflation in dairy oil and flourish supported by gross margin expansion and productivity led efficiencies. Reported EBITDA margins improved by 110 basis point year on year and to 20.5% on a pre Indias basis. EBITDA margin expanded by around 90 basis points year on year and 120 basis points sequentially.
Our technology and AI initiatives continue to translate into tangible outcomes. Monthly transacting users on our apps grew over 20% year on year in each quarter of FY 2026 and the number of active customers Using Post order page Active clients sorry using post order page advertising cross 10 in the quarter. Standalone profit after tax continued from continuing operations before exceptional items grew 27% year on year and TAC margin expanded by 54 basis point. Turning to our international business, Turkey continued to deliver ahead of our plans. The business has consistently delivered double digit year on year growth while maintaining strong back margins.
We are pleased to share that Turkey is now servicing its acquisition related debt entirely through internal cash flows. During the quarter the business added 33 new stores including 15 dominoes and 18 coffee stores. Sri Lanka and Bangladesh also delivered high double digit growth during the quarter and both countries have positive growth and margin expansion trajectory. On a consolidated basis, EBITDA grew 20% year on year with EBITDA margin expanding by 110 basis points. Consolidated PAC from continuing operations before exceptional items grew 94% with PAC margin expanding 167 basis point year on year. In summary Q3 FY 2026 delivered strong growth across brands, disciplined execution and expanding profitability.
Our growth factors are clear, our execution strategy is working and we are deploying capital with discipline while investing ahead to build a large 5,000 plus store business. We are confident that our continued investments in technology, supply chain and store expansion will drive durable long term value for shareholders. I now request the moderator to commence the Q and A session.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask questions may press Star and one on the Touchstone Telephone. If you wish to remove yourself from the question Queue, you may press star and two participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from Vivek M from Jefferies. Please go ahead.
Vivek Maheshwari
Hi, good evening. Sameer and team. Two questions from my side. First on the LSL Number of 5%, what is your outlook? Because there was a bit of a festive season shift in this quarter. Where do you see this number? Let’s say through the course of 2026. Because in your opening remarks you also mentioned about the base and that is going to stay stiff for rest of the year this calendar. So how should we think about this?
Sameer Khetarpal
Yeah, Vivek, the way we are building and shaping the entire standalone business is the following domino should grow at 5 to 7% like for like growth overall top line should grow for standalone around 15% and we should get to closer to 15%. 3 India’s margin right now that’s kind of how the math like stacks up for me and that’s what we are like internally always gunning for and there. And therefore to answer your question, I don’t see any headwinds in terms of building up 5 to 7% life or life growth business.
Vivek Maheshwari
Interesting. So you do not think that this slips further down as we go forward through the course of the year because there has been this fear that now that the base is reasonably high, this will actually keep slipping down as we go forward.
Sameer Khetarpal
Yeah. So I think if you look at see the, I think just to remind all the analysts and investors, we are now lapping in March we will complete two years of free delivery. Right. So I think I just want to clear that notion. So we already lapped up high basis and if you look at FY 2025 standalone basis we grew 14.3%. That’s when we started the free delivery. In the current year, nine month growth rate is 15.1%. So we are already growing on a large base higher than the previous year. So I am less worried on that particular piece. I think our businesses continue to do well. In fact, internally we have started tracking through AC Nielsen market share gains. So our market share we also gained market share not only within pizza but across the relevant segment from bowls to chicken to burgers. So I think there is huge headroom to grow 1/4 here on there I will skip that. But overall 5 to 7% I don’t see that there is a challenge and our business is geared for that.
Vivek Maheshwari
Got it. Sameer, second question is on, you know, if you’re going back in the history as well. As you know, the conventional wisdom will say that as lfl, you know, accelerates, margins typically expand and reverse has also been true in the past. This time around, obviously with the decelerating lfl, your margins expanded quite smartly. Can you just give your views on anything related to the quarter? We can of course see the numbers. And how do you think about the outlook specifically for F27? Yeah.
Sameer Khetarpal
Yeah. So I think the I let someone give any additional color. But it’s important to note that I think this was a constant question that hey, you are having A LFL of 10 to 12% and margins are not rising. Right. So we were investing in for growth. We got the customer. We know customers repeat once we acquire them and there is always an opportunity to take calibrated price increases but equally work on the efficiency. So we worked on both the fronts and if you recall, when we did free delivery, we launched big big pizza next year and as a result both were dilutive.
But this year we’ve come back and launched cheese lava pull apart sourdough pizza. We’ve taken calibrated price increases so we have put in more levers to to improve our gross margin and tightened our cost structures to get more juice from our ebitda. So I think I am actually less worried on margins. Vivek. There is always more room that I see my organization growth is something that we have to always be paranoid about because we are building a 5,000 store network business and not just a 3,000 store network business. Any color on this year?I think we are on track.
Suman Hegde
No, I think we are on track .Vivek Sameer has answered the question. But if you look at it also in terms of basis. Right. So one, of course the constant conversation which is happening on gross margin, if you see over the last couple of quarters sequentially and we had said that out in the markets as well, that there’s an investment made in FY25 behind the product portfolio to ensure that we give back value to customers. And as we bring in new mixes on our innovation, we will see the accretiveness of those mixes playing out, which is happening in case of the new launches we have had in terms of sourdough or be it the cheese lava pull out that has now got launched.
So that is of course reflecting in the margin improvement at a gross margin level. And then if you look at the other expenses while they have grown, if you look at personal expenses or manufacturing, they are however growing behind the growth that the business is seeing. So the business is seeing about 12% growth approximately. The other expenses are not growing in tandem, which is the way it should be. And we still believe there is more optimization we can do. So all in all, that’s how the margin profile is playing out. Operating leverage of course, kicking in and the margin gross margin improvement profile that we are driving, which we believe will sustain going forward as well with the kind of growth aspirations that we have and which Sameer has called out.
Vivek Maheshwari
Got it. Thank you on that. And if I can add one more, which is, you know, when we look at let’s say the two food delivery platforms, Suvi as well as Zomato, both of them have quick commerce investments and both of them in some ways are using food delivery as a so to speak, cash cow business. They have reintroduced, sorry, they have introduced platform fees, high delivery fees. How do you benchmark yourself? Do you take a clue from what they are doing and therefore do you plan your strategies and what are your thoughts on your own delivery? Cheese one way or the other? Can you just elaborate on that?
Sameer Khetarpal
Yeah..So I think let’s look at our strategic objectives, right? So we want our own assets to grow the fastest, be the channel where we really get the customer love and the most immersive and financially the best reason for customers to shop. So these tenets will continue to guide our investments and our pricing decisions for customers. So I do agree that in the last quarter or so aggregators have brought down their minimum order value to 99 rupees. And in some places we had to go back and correct and match that right to not lose market share.
So we’ve done that on the see, they are a platform and therefore they can charge a platform fees or Platform Commission etc. We are selling. We are in the business of selling, shopping and giving an outstanding experience of pizzas. So for us at least my own take is the, the things like platform fees, etc. Are not relevant. Having said that, that’s an option that exists and we can, if need be, we can again switch on that button at midnight tomorrow and it will be available on source. That lever stays for us. I want to remind everyone that we are building a 5,000 store business that is most penetrated and I believe these are actually barriers to acquiring customers.
Vivek Maheshwari
Got it Sameer. Always like and respect your focus on growth. Thank you and wishing you and your team all the best.
Sameer Khetarpal
Thank you Vivek.
operator
Thank you. The next question is from Manoj Menon from ICICI Securities. Please go ahead.
Manoj Menon
My team, good performance. Just a couple of clarification. The first one I Know that it was discussed in the past as well. But looking for a refreshed view if any which is essentially the growth divergence, continuing growth divergence between dine in and delivery. Now the context which. Samir, I just want one more call up in this call would be let’s say, you know what percentage of let’s say consumers overlap between delivery and dining. What I mean is that is it an either or, is it an addition? The reason I’m asking because while you are outperforming overall and delivery continues to grow and it’s more than.3%, etc.
Sameer Khetarpal
Hello? Sorry, the voice is actually backing up and breaking. We’re missing a few words in between.
Manoj Menon
Is it better now? I’m just very close to the mic. Okay, I’ll just give one try and. I’ll confirm another connection.
Suman Hegde
Yes please.
Manoj Menon
Okay. Yeah. So the question is actually on the growth divergence between dine in and delivery.
operator
Sorry to interrupt Manoj, but we can’t really hear you. Request you to maybe rejoin. Thank you. We’ll move to the next question. The next question is from Nihal Mahesh Jaam from hsbc. Please go ahead.
Nihal Mahesh Jham
Yes, good evening Sameer and congratulations on the performance. I have three questions just starting off again on the margin bit on the gross margin side you mentioned about obviously that marginal price hikes along with new product launches that were obviously one of the key drivers of gross margin improvement. Just moving below what have been the incremental lead levers which has led to an operating leverage. We see that employee expenses have also gone down. And does the labor code in any way rehash our employee expense growth going forward? That was the first question.
Suman Hegde
So I think on gross margin, no more flavor to add on that, Nihal. So like we mentioned, predominantly driven by mix improvement that we have seen led by further efficiency that we’ve brought in. We have again recalibrated our pricing to look at where we can get the most value without of course impacting growth in any way. So that’s really driven the gross margin trajectory which we believe will also go on as we get into the future on operating leverage on personal expenses. Honestly, if you look at increments and what the numbers are, that’s the kind of increase you would see really nothing out of the ordinary out there from a labor code impact perspective.
We have taken of course, the one time exception going forward. Yes, there will be some impact that will come into the cost line. We anticipate as of now while you know, there’s no definitiveness on it because everybody is looking at restructuring their wages and you know what Will the definitions actually roll out when the implementation happens in April, but maybe about 15, 10 to 15bps is the impact that we see at an overall level at an outer limit. But we of course continue to look at nothing material that I want to call out.
Sameer Khetarpal
Also the issue see we’ve been very disciplined in headcount increase. We’ve also deployed technology and AI we’re beginning to use to drive efficiencies in our corporate G and A and that has given the leverage and I think we’ve been super disciplined in the last two years in where to deploy the technology so that leverage is coming in.
Nihal Mahesh Jham
Got that Sameer, the second question is you mentioned for the first time about this AC Nielsen data and also tracking the growth for Domino’s versus other categories like say burgers. Now just one question that you know, how do you innovate the lakazi that may come with the category of pizza itself and how do you sort of compete with other categories Whereas you are a single category brand and you’re sort of competing with aggregator. So what is the insights or incremental steps that you are taking to sort of gain market share from the other categories knowing the fact that you only work in one subcategory?
Sameer Khetarpal
Yeah, nothing. And that is the fundamental job, right? With almost nearly 2/3 of the market share in the category. Right. The job for us is to grow penetration and nehal it is actually not pizza versus burgers or taking if you so India is a $60 billion food services market. So our competition is bhutura chana, dosa, idli biryani that is what India consumes and the frequency of pizza is is three in a year and burger will be probably the same. So the idea is to not like bring burger from 3 to 2 and pizza from 3 to 4.
But the idea is to out of 200 occasions that Indian is consuming Indian food get one additional share of pizza. So that is the job to be done. And therefore you will see on the premium end we are launching sourdough pizza because there are premium users who are doing it. On the lower end we have a 49, 59, 69, 79 pizza that competes with idli and dosa that India consumes every day. So that is our endeavor and that is the task of our marketing team to come up with products that actually replaces whether it’s a Gen Z chai chi where a samosa comes in, bring pizza into the mix.
Nihal Mahesh Jham
Got that? Just quick final question Suman you could give the capex number you’re targeting for this year and the years ahead. Given that you said you’re optimizing on supply chain, already done with that.
Suman Hegde
So I think this question comes up all the time Nihal, but the fact is supply chain. I think I mentioned the last quarter’s call as well. Our overall CapEx spends in the last couple of years have been in the range of anywhere between 700 to 850 crores. Yes, the supply chain capex has peaked but we do not expect a significant movement downward from the CapEx bill because we are of course recalibrating. We’ve called out saying we want to open thousand stores in the next three years. Right. Which means that the store capex will kick in.
We continue to invest heavily behind technology because we do believe that that will not only drive growth but also efficiency for the business. From the cost and margin profile perspective, these will have of course faster paybacks and ROI compared to a supply chain investment. So we should see the return on capital employed on this going up but not a significant movement on the overall CapEx spend. Of course, as we close the year in the final quarter, as we always do, we’ll give a rough guidance on what we believe our CapEx budget for the subsequent financial year.
Nihal Mahesh Jham
Got it. Thank you so much.
operator
Thank you. Next question is from Ashish Kanodia from Citigroup. Please go ahead.
Ashish Kanodia
Yeah, thank you so much. Your first question was on the lfl. So if I look at, you know, the last eight quarters performance, the positive LFL was, you know, coming predominantly because of all the strategic intervention you have taken in terms of product innovation, free delivery, etc. Now if I look at this quarter call commentary by other QSI players, there seems to be some uptick in demand. We don’t know whether that flows through or not, but there is definitely some uptick in demand. So in that context, and I think in one of the earnings call you called out that as well that if the industry growth start to improve there will be an upside risk.
Suman Hegde
So looking ahead, do you see that if the industry starts to improve or start to see positive SSG overall there is an upside risk to this 5 to 7% LFL which we have discussed.
Sameer Khetarpal
I think of course that’s why we have a 5 to 7% and I think the government has done a lot on consumption. I don’t have a market view. I can talk about what we are doing. We are penetrating into schools, colleges, airports, railway stations at a pace that we have not never done before. We are opening stores with very high quality throughput in year one. With a lower capex there is a lot of work that has gone into it. Our site selection is totally AI enabled now and we have a list of thousand stores. So I do see that the brand is very strong.
Our mature store ads has been the highest ever in the last quarter and we are very confident about our growth strategy whether coming from both LFL and also organic expansion in white spaces. So that doesn’t worry me. India is a very large opportunity and a multi decade opportunity and we are finding large profits of growth.
Suman Hegde
Sorry, maybe I’m just going to harp on this one. Last quarter let’s assume if the industry while listed there was if The SSG was minus 3, minus 4% and you have still delivered 5% LFL. If hypothetically you see industry QSI space starts to grow at 2% 3% SSG do you see? You know this instead of 5 to 7% this goes maybe to 8, 9%?
Sameer Khetarpal
It should happen I think empirically I would agree with you. Right. So that we always outperformed in the last eight or nine quarters. If you see in fact even before that I have always been gone on record and say we should be because of our execution ability, self help initiatives and the confidence in the brand we should always be +3.4% versus the rest of the pack. And I say it with all humility because the brand is that powerful.
Suman Hegde
Sure. Thank you. The next question was on Popeyes. You know like we have seen store growth slightly slower but definitely SLC being very strong in the last two quarters. How should we think about Popeyes over the next 18 months in terms of both store expansion and also if you can throw some color in terms of your gross margin as well as on store level EBITDA margins. How it is trending now?
Sameer Khetarpal
So firstly the SSG for pop oils has been positive Double digit for 3/4 in a row and the last quarter being the highest ever and very strong growth numbers that I see. As a result we are far more confident about popoise being able to scale and be the real speedboat for growth in our portfolio. That’s kind of overarching and therefore coming back to your question, so what are we at a 5000ft optimizing for? At a 5000ft we are optimizing for average daily sales that is equal to industry and gross margins that are at industry. Once we do that then we know that the model really works.
There is customer adoption at a price that we are willing to command in the market as a challenger brand. And second is we are able to bring the Sourcing capabilities and technology of jubilant to have the right gross margin. Once we do that then we know how to open 300 stores in India. Right. So that’s kind of the equation over here. We have one or two pieces to crack. Right. And but I would say bulk of work, 70 to 80% has been done. We’ve seen highest ever adses in the in the last quarter. Gross margins have improved, restaurant profitability has improved and we are well on track.
And in about 100 stores we will start disclosing the numbers to all of you and then we can scale faster from there. But at no point I want to make this as a land grab where we are opening stores and then we have to shut down one year later. So very confident about this. We will stay invested in this piece. In fact in Bangalore this quarter we launched our first advertising campaign even just with 70 stored. No, no other QSR has done it with a celebrity film star as our lead anchor over there.
Suman Hegde
And just last question to Suman was on the Turkey part of the business. If you can share how much of the total, you know, dividend has been paid by DP Eurasia and also what is the total date outstanding pertaining to the acquisition?
Apar Saraswat
The debt outstanding the debt we took on account of the acquisition of 110 million euros in our Netherlands entity Ashish and that of course the repayment schedule has not come up and we will look at what we do with that repayment. Most likely of course the way Turkey is generating cash flow we will look at funding some of that also from the Turkey cash flows. Having said that, and hence right now the obligation and debt are only with respect to the interest. 100% of the. The interest obligations are being paid by the Turkey business now since the last three quarters. So there’s not, there’s no remittance of funds or cash flow from the India business on account of the acquisition debt that sits in Netherlands.
Suman Hegde
Sure, got it. Thank you. And all the best.
Apar Saraswat
Thank you.
operator
Thank you. The next question is from Manoj Menon from ICICI Securities. Please go ahead.
Manoj Menon
Hi Tim. I have only one question or a clarification which is essentially a request for a refresh of something which would have been discussed in the past. Essentially the growth divergence between dine in and delivery. You know, delivery brilliant performance continues to grow double digits comfortably for a long time. You know, you have done some interventions in the past to get the dining throughput. If you just talk about where we are in the, you know, dine in, let’s say rejuvenation journey. You had done some product pricing actions etc. So that’s one one subplot which I just want to understand here is you know, in your experience and your opinion is this unique consumers.
Let’s say what I’m what I mean is that you know, if a consumer is consumer is buying and you know, let’s say if there is a dine in shop nearby, you know, I mean is a propensity to go and dine out or is it just an impulse consumer or capturing there is that either or situation or you know, both are, you know, separate consumers. Thank you.
Sameer Khetarpal
Nothing Great question Manoj. I think your analysis is right that delivery continues to be to power ahead our growth and dine in and take away us to additional channels. We put in a lot of intervention does not clear out and that’s a fair and accurate representation of her performance. Having said that, firstly we’ll continue to fuel delivery tailwinds that’s world over. That is the fastest channel growing and we believe we have very strong capabilities over there to delight our customers. Now coming to dine in takeaway we are going back to the drawing board re looking at our strategy what is working, what is not.
Few pieces are working and last quarter I generally believe we should have done slightly better. But there were but I will not give any excuses we’ll come back and fight hard for that piece of the pie coming to what’s happening on the new customers, right? So pre Covid the largest acquisition channel for us for new customers was dine in and those customers moved to delivery post Covid and more recently because all the investments in app 20 minute delivery free delivery. The largest new customer acquisition channel actually is our own app and dining takeaway is lesser.
So even so therefore, both in terms of absolute and percentage growth our own asset is the largest and the fastest growing channel. So which augured well for us. That’s what we want. We have a lot of customer data and we will now for dine in and take away. When we acquire customers they actually after the first purchase they move to our online channel. They know that this is a very convenient channel and therefore the answer or the question that we have to solve for is to build a strong dine in and take away proposition which is very differentiated and compels the customer to go to the nearby store which is the most penetrated and the easiest to access in terms of restore reach to go and do a dine in order takeaway along with certain occasions.
So that piece we are fully on Manoj and we Believe there is some work to be done but we’ll get it. We are not leaving that leaving that problem.
Manoj Menon
Thank you. Thank you Sameer and team, good luck.
operator
Thank you. The next question is from Manish Podar from Invesco Asset Management. Please go ahead.
Manish Poddar
Yeah, hi. Just two bits. First is let’s say can you help me understand you know how much of let’s say the delivery orders will be happening through our app broadly and you know this monetization of you know the, the ad page on our platform or the app. Now how big can this be? Because if you look at from a you know MAU perspective your numbers are significantly high. So let’s say how should I think of of these two variables? One is you know your delivery from your app versus aggregators today versus let’s say if you can help me understand 12, 18, 24 months back some bit which you alluded earlier and the second bit on this app bit. Thanks.
Sameer Khetarpal
Okay. No, very good. We don’t disclose our share of our own own channels versus the aggregators. It does not. I think the we what we control and we want to grow is our own channel. So I think that continues to grow. I think the momentum strong and the share is very strong. That’s one the second piece on we started this journey a quarter ago. In fact this is exactly four months ago. We started our first right after Diwali. We actually got into this and we were experimenting with this particular piece. We are very positively surprised by the engagement and the quality of brands that we been able to get from Flipkart minutes to Tata Neo to Amazon Fresh to Apple.
And there is a lot of interest from this because again we have built a very strong tech foundation where we can target by a zip code in India give more analytics back to the customer. And if you really see if our average frequency is 3 so in a year then willy nilly you are bringing you are getting eyeballs of a product to a new user. And like you said, 15, 16 million monthly active users is a very large consumer base. So at least my own take is at the right time. I’m not saying in short term we should get about 1% of our revenues on that channel.
We should be able to monetize to that extent. Having said that, we have taken a conscious call to not monetize pre order or the pre order journey only post order. We are monetizing it. If we open up more assets, there is more efficiency to be or more revenue to be earned. But at the moment we are focused only on post Order journey. We want to give immersive and a friction free shopping experience and a fast delivery to customers once they’re on that page. We are actually experimenting a lot. So take for example if I get a credit card, if I get a credit card application you get an immediate discount on that order funded by the credit card company.
So some of these things we believe we are the only one who can use it, configure it, buy zip code and to target a customer cohort who’s we can Apple can target Android customers and Android can target Apple customer. Some of those things are very unique, unique to us and, and we will scale that up and it’s an important area. We know it. All of this flows into the bottom line.
Manish Poddar
Sorry just if I hear you right you said 1% of online sales from our platforms will be able to earn let’s say maybe some. Some period down the line. Is that, is that the right understanding first.
Sameer Khetarpal
My own sense is 1% is minimum we should get to.
Manish Poddar
But Sameer, actually, I’m just trying to understand this number because let’s say when you look at another BPC player which has you know, annual subscribers equal to your monthly subscribers their ad revenues in my understanding are not the finder crores annual number. So I’m just not a. Right.
Manish Poddar
But I’m just trying to think is. I’m. I’m sorry, I’m just trying to speak aloud. You know, maybe two, three, four years down the line can this not be a three digit crore number? Thanks.
Sameer Khetarpal
We’ll get closer to that right. It’s like a. That’s what you aspire to get. But the only difference and I have run this business is a lot right in a grocery 8 to 9% of your revenue can come from advertising because the brand like let’s say there is a noodle brand, that noodle brand is advertising on the brand and the click through of that can directly lead into sales. So brands are. It is like modern retail where brands would do display advertising and so we are slightly different right. We can’t other than Coca Cola we can’t advertise anything where customers can click and get that instantaneously.
So same thing in a BPC kind of a play l’ Oreal or Lakme or anybody will advertise upfront to drive the sale. It’s a pre order journey that they try to intercept. We are doing post order and again we want to be there is more money for sure but we don’t want to hurt the customer journey of ordering a pizza in three to four clicks and deliver that in 20 minutes. That remains sacrosanct. Everything else we will try on post order page we are very confident fullness of time it can get to 3 digit or close to that. That’s what we are also aspiring for.
Manish Poddar
No, got it. Thank you.
operator
Thank you. The next question is from Amit Sachdeva from ubs. Please go ahead.
Amit Sachdeva
Hi, good evening and thank you for taking my question. Sorry. And my question is on the margin space. So my sense is that if I look at the margin expansion in pre index which seems very impressive and the great job done but can I sort of double click on a bit and ask whether rental saving is now part of the equation which seems structural because now I think delivery is larger part of the piece. So is there some ongoing rethinking of the store happening and rental as a percentage of declining? Because I know that in the first half of this year these expenses from the cash flow which I would say would be rental is 7%.
Last year that number was 7.4. Is there a consistent saving now as part of the equation and how sustainable that is and what the number could be? So that is point number one. And on related points, second question would be on Popeyes whether you know in 15% growth ambition at standalone level how much this will be contributed with Popeyes over the next three, four years and how much margin at a bitda level would be contributed by Popeyes as well. Because I think if the journey of that is also increasing how one should think about that these two pieces together.
Apar Saraswat
Let me take the first one on rentals Amit and then I’ll give Sameer’s question on growth and then come back on popoise margins. So I think on Brentford you’re absolutely right. I think you answered the question yourself. So yes we are seeing leverage coming through on rental. Part of it coming through on account of of course scale that is generating more revenue. I mean of course a better LFL gives us the scale operating leverage for insurance rental which we have seen coming through in our pre indias numbers. Apart from that there are also other opportunities we are looking at.
Our rent per our per square footage of our stores is on a downward trend. Again like you rightly said, if you’re hitting a 75% delivery mix now as a business it could vary between the tiers of cities we operate in but overall the square footage of our stones is kind of coming down which will again be an additional fillip to our rental going forward. So I think those are the two elements that we’re also very focused on of course also on renegotiation. In many of the new cities and towns that we’re going into, we are anchor volume for the landlord.
So do we get. We do get better deals as we enter in there because it helps them get in more other businesses as well. So all of these three metrics we’ll continue focusing on. Will there be a very big increase on the leverage coming through on rentals? I don’t think it’s significant. Even now it is not a significant part of that 90bps of improvement that we are seeing. It’s not like it is 60% of that comes from rental. Right. So it is a component but not continue to be there. So that’s on the rental part.
If it answers your question, maybe Sameer can take the popoise growth piece and. I’ll come back on the Dunkin’ side.
Sameer Khetarpal
I’ll come back on. I think the popoise that should add like one one and a half percent to growth. Right. So that’s the what we how we are building this. Right. At least in the near term. And if we see more grown growth shoots like green shoots we can actually accelerate the store expansion. Right. So we are not. And what is the green shoot? Right. The green shoot is we should be industry leading or industry par on the average daily sales and the gross margin should be equal or higher. Right. If these two things happen then we know other line items can take and I think like if Domino’s is adding like 75, 80 stores a quarter there is no reason why we can’t add 1520 stores of Popeyes in a quarter.
Right. And most of those locations will be high street locations. So that’s where because there are so many malls that or airport that you can get into. So that piece is remaining and therefore this should make money. Having said that even at scale, even if you look at the fried chicken players, their margins are lower than that of Domino’s. So even at the fullness it will be a drag compared to in terms of mix. But right now I think we are far away from that. We want to make sure that we are getting closer to profitability at a restaurant level.
We we make money at the EBITDA level and then start generating more cash from that business. So that’s how we are operating. But Amit, very positive story in terms of what the team has been able to do differentiate in terms of bring the freshness of that in the QSR which is with a brand like Popoise.
Amit Sachdeva
Great. Thanks so much for that. If you don’t mind is there a rough ads that you can share if possible in say Bangalore. It’s not in all but a typical ads that store is getting which you are satisfied with and obviously there’ll be a range I don’t want to ask too much of details that you don’t share but how do we make sense of it that how ads is evolving for this although the ads you know SSD looks very strong but in terms of ads how it is kind of. Range could be.
Sameer Khetarpal
Give us give us give us four months we’ll four months we will we’ll come back to you on that one. You’re very close. Let’s get to 100 stores. We’ll disclose everything and like I said the our goal is to be at or market beating adss and gross margin right so we are on that trajectory to be very honest and many of our stores are actually operating much more more than that. So I assure you that our our rates are positive. We are growing in terms of ads SSG and and the underlying restaurant profitability all three ticks for it and we want to expand faster provide the location is right. That’s our intent.
Amit Sachdeva
Got it. No thanks so much it last night just last bit if I may squeeze in Suman this question is for you. Like I remember discussing when the company level previous margin was standalone as well we were talking about EBITDA margin for Domino’s at 14 and a half level. Now we are reaching 13.3. I assume this largely driven by dominance. Given the dominance of the format what could be the margin for Domino’s would be like for like which was 14.5 and what could be the sustainable margin that you’re looking at assuming 15 is achievable how one should think about Domino’s margin on a standalone basically sustainable basis.
Suman Hegde
Amit, I think we said that we will disclose Domino’s margins once a year. We do know the numbers of dominoes of FY24. We also disclosed in FY25 which is around the 14.5% range that you only spoke about. Right. So let us wait a quarter and we’ll give the full year margins out again on domino. So I don’t want to comment on it right now because you can’t actually compare 13.3. We know how quarter three is for our industry. Quarter three margins are always higher. Correct then and you you see that moderation in Q4 so I think it’s better to compare it at a full year level.
Now coming to how should you look at it. I think our guidance has been been consistent saying that FY24 margins above that. We want to improve about 200bps at an EBITDA level as a company. And a significant part of that will of course come from Domino’s margins improving and the reduction of the drag on the ebus. At the point in time that we had disclosed our number, the drag was off. Popoff, Duncan and Hong was approximately about 230, 250bps. And we should see that halving in that journey to getting to the overall margins up. So then that’s the way you should triangulate it. Of course, you’ll be able to do a better guess of it as we come out with the full year numbers in the subsequent quarter.
Amit Sachdeva
Just to clarify, 200 above FY24, right? That’s what you said.
Suman Hegde
Yes.
Amit Sachdeva
Okay, got it. Thanks so much. Thanks, Suman. Thanks for taking my question. Thank you.
operator
Thank you. The next question is from Aditya Soman from clsa. Please go ahead.
Aditya Soman
Yeah, hi. Thanks for the opportunity. So, a couple of questions. So firstly on Popeyes, now that we are seeing sort of steady and strong performance from when would you report this as a separate segment? When we start getting data on this in terms of ads and SSG and even the revenues separately.
Sameer Khetarpal
Yeah. I think by end of like the Q1, we should think we want to get to 100 stores. That’s what we had committed earlier. As soon as we get it. I would have anticipated for that to happen in Q4. It will not happen in Q4. It will happen, may happen by Q1. That’s where we should start reporting the numbers.
Aditya Soman
I understand, thanks. And then it’s just a journey of Popeyes. I mean that we’ve seen since we’ve launched it to where we are now, what has led to sort of the significant improvement in ssg. But do you think that the model now is at a point where the client model is the one that you sort of roll out across the country? Overall.
Sameer Khetarpal
We’Ve differentiated from the competition. I think if you just step back so we are three, three and a half year old brand, we’ll still be the probably the fastest, if not the fastest to get to 100 stores. And when we started there was a playbook that the brand like had guidelines. Right. They were not meant to follow it strictly. But still when you are bringing a brand, you have no knowledge and you are therefore trying to deploy a playbook that works everywhere, ie 4 to 5,000 sq ft stores, large flagship high street stores. Right. With very heavy capex in the kitchen, large area for the kitchen and A menu that we do not know will work for India or not.
So take for example biscuit is a very popular product in US but that’s not a biscuit. That what you and I understand, right. It’s kind of a cornbread or a bread which will be very. So we got in all those equipment and assuming that this is how the brand works. So we corrected. We also built our supply chain capabilities to source fresh chicken, to invest in never ever antibiotics use chicken. So we did all of that and we also equally at the front end started to differentiate versus consumers. So Popeyes world over stand for its boldness and flavors.
The Cajun, The Cajun base or the Cajun flavor resonates more with Indian and we brought more flavors to India to give you two examples. So we looked at chicken wings and brought six variants of chicken mix with six different sauces indicating heat etc. And taste. Similarly we launched seven sandwich chicken sandwiches which are, which are flavor burst certain. We are going, we are taking the route where we believe this can be the most loved chicken brand in India. And I genuinely see that this to be a 250 store thousand crore business in medium term and with very high profitability.
And that’s what we are building. That’s how we are shaping the. Shaping the business to towards and we are one tenth, we are getting closer to 1/10 of that journey and we have to continuously innovate. Right. What worked last year for sure will not work next year.
Aditya Soman
Understand. Thank you so much for that comprehensive response and maybe just a follow up on this. Would it at some point make sense to have a sort of common app across your platform? Just given the strength of the numbers with sort of MAUs and MTUs, particularly for Domino’s. Could you. Is there a way you can also shift that to pop ups and the other.
Sameer Khetarpal
Yeah, I think this is to see if you will need a. And I’ve looked at these models very closely and I also launched one of the food aggregator businesses in India five years ago. You need a certain threshold of brands for an app to work and that threshold in my opinion is 20 to 25 brands per zip code. Anything below that, a single app doesn’t work just because we are jubilant customers will not open an app. There are multiple models as you see. There are dark kitchen models with seven, eight brands there are or even more.
Even their own app traffic is very limited. So they have not been able to grow that for the very simple reasons. The customers inadvertently want more selection and they may still choose Domino’s among that 40, 50 brands that they are browsing. But there is innate need to have more. So at least my past experience and knowledge suggest that this is not a good investment of technology. The two brands are different, occasions are different. We’ve launched Popeyes own app. It is going to be the most immersive app for burger eating and chicken eating in the world.
That much I promise you. And once customers like that will get good prices again. Like the pizza box never leaves our hands, the bun level never leaves our hand. We followed that same approach in popwise and we are building the business with the right fundamentals and with aspiring for lot of customer love.
operator
Thank you. In the interest of time, you’ll be able to take one last question. We take the last question from Jay Doshi from Kotak. Please go ahead.
Jay Doshi
Yeah, hi. Thanks for the opportunity. Very quick bookkeeping questions. Are you expecting any upward revision or downward revision in your royalty expense? I vaguely remember that your franchise agreement with Domino’s was due for renewal, but I don’t know if it’s already done. And do you have visibility in terms of, you know, next five years, 10 years, what your royalty for Domino’s would be?
Sameer Khetarpal
You know, I think we are not expecting any upward or down one downward movement. We believe we have very good rate. We have outstanding relationships.
Jay Doshi
Thank you so much.
Sameer Khetarpal
Thank you, Jay.
operator
Thank you very much. We’ll take that as the last question. I would now like to hand the conference over to Mr. Apar for closing comments.
Apar Saraswat
Thank you everyone for joining the call and for listening patiently for any further questions. You may reach out to the investor relations team of the company. You will find the recording and transcript of this call on the investigations page of our website very soon. Thank you. Have a good evening. Thank you.
Sameer Khetarpal
Thank you very much.
Suman Hegde
Thank you.very much.
operator
On behalf of Jubilant Food Works Ltd. That concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.