Franchise holder of Domino’s Pizza and Dunkin’ Donuts chains in India, Jubliant FoodWorks is all set to raise the price of its products by 3% owing it to the continued inflationary pressures, a senior executive from the company said.
While announcing its second quarter results on Wednesday, its chief executive stated over a conference call the fast-food chain operator will continue with these “nominal” price increases in the backdrop of a growing economy. The company has effected around 6.5% price hike so far this year, said Ajay Kaul, CEO of Jubilant Foodworks.
Last year the company raised prices of its Pizzas by 12% largely on the back on input costs going up unabated. The company reported a 36.63% rise in its net profit to Rs 32.34 crore for the quarter ended September 30, 2012 on the back of the growing consumption story among Indians especially in smaller towns and cities. Kaul said the company has revised its target of opening 100 Domino’s Pizza stores to 110 for the financial year 2013 and will open a total of 10 Dunkin’ Donuts stores in the same period.
An investment of Rs 150 crore will go in to the opening of these new stores, he said. Same store sales growth, an important yardstick in the retail sector, came in at 19.8%. A few days ago, Morgan Stanley downgraded the Jubilant stock to “equal-weight” from “overweight” saying the company will face increased competition in the delivery business from Yum! Brands’ Pizza Hut.