Domino’s parent Jubilant’s profits fall by 2% – Swiggy, Zomato could be the reason

• The company has reported a profit of ₹7,592 lakhs which is a 2.2% fall from the same quarter in the previous year.
• Meanwhile, its total revenue from operations stood at ₹98,823 lakhs.
• In Q1 FY20, the company had seen a profit after tax of ₹7,478 lakhs.

Jubilant Foodworks, which runs Domino’s and Dunkin Donuts in India reported a 2.2% fall in profits for the second quarter to ₹75.92 crores. In the same quarter last year, its profits were at ₹77.67 crore.

Its total revenues went up by 12% to ₹988 crore from ₹881 crores in the same quarter last year.

The stock of Jubilant Foodworks was trading 5.10% higher at ₹1,429 at 2.30 pm.

The marginal fall in profits seems to have been affected by multiple factors – the slowdown in the country as well as the growing dominance of Zomato and Swiggy.

The stock was downgraded to underperform by the brokerage firm Credit Suisse in late September due to “a weak demand environment and aggressiveness of online aggregators”.

Analysts pointed out that the “aggressive discounting by food aggregators over the past few months continues to impact the dine-in industry and Jubilant Foodworks’ dine-ingrowth in the top-10 cities”.

In the US too, Domino’s saw a similar turn of events, with food delivery aggregators like DoorDash, UberEats, GrubHub literally eating into its sales.