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Sapphire Foods shares were up 8.7 per cent at Rs 383.05 per share on BSE
Shares of Sapphire Foods, which operates the Pizza Hut and KFC chains of restaurants, gained 13.6 per cent intraday to log an all-time high of Rs 400.5 per share on the BSE on Tuesday. The stock gained after 8.05 million shares changed hands on the NSE via multiple block deals. The details related to buyers and sellers could not be ascertained yet.
Sapphire Foods Q1FY25 results
In the quarter ended June 2024, the company recorded a consolidated net profit of Rs 8.18 crore, down 67.2 per cent year-on-year (Y-o-Y) from a net profit of Rs 24.87 crore in the year ago period. The company’s revenue for the quarter under review stood at Rs 718 crore, compared to Rs 654 crore in the year ago period.
India’s quick-service chains have been struggling to attract customers amid persistent inflation, which remained around 5 per cent during the quarter. Financially-strained consumers have been cutting back on dining out and ordering in.
The company said prices of ingredients rose nearly 10 per cent, expanding its total expenses by 13 per cent to Rs 712 crore. Sapphire’s same store sales also fell 6 per cent and 7 per cent, respectively, for its KFC and Pizza Hut outlets in India.
The company said the “KFC chain was impacted the most” by a shift in the dates of a festival when Hindus typically reduce consumption of meat.
After the Q1 results, Centrum Broking cut its rating on the company’s stock to ‘Reduce’ from ‘Buy’, with a revised target price of Rs 1,630, from Rs 1,455 per share earlier.
The brokerage reckons the company’s management has reworked its store expansion strategy and is also taking initiatives to build consumption occasions using innovations that could ensure margin trajectory.
“With sequential improvement in Pizza Hut and Sri Lanka business, we tweak earnings for FY25E/ FY26E by 1.9 per cent /0.2 per cent,” the report said.
In the past one year, shares of Sapphire Foods have gained 18.6 per cent, compared to the BSE Sensex’s rise of 28.7 per cent during the same period.
First Published: Sep 24 2024 | 1:36 PM IST
