PL Capital: Domino’s Delivers on Value, Urban Demand Drives QSR Rebound

Mumbai | June 20 – “Domino’s is seeing steady momentum with value-led offerings and improving footfalls across metro markets,” noted PL Capital in its latest consumer sector update.

According to PL’s channel checks, the quick service restaurant (QSR) space is showing signs of sequential recovery in Q1FY26. The uptick is driven by urban demand recovery, consistent performance in delivery channels, and menu innovation—particularly for Jubilant FoodWorks, which operates Domino’s Pizza in India.

The research highlights improving average order values (AOVs), better customer retention through combo meals, and a noticeable softening in competitive intensity—particularly in the pizza segment.

What’s Working: Domino’s Maintains Lead

Jubilant FoodWorks continues to outpace peers in delivery-led growth. Consumers are opting for Domino’s over standalone pizza brands due to perceived better value, stable pricing, and faster in-house delivery. The recently launched “6-in-1 Big Pizza” has performed well among group orders, though delivery quality consistency remains an area for operational improvement.

Demand during the IPL season was stronger on a year-on-year basis, and Domino’s has continued to benefit from lower competitive heat from new entrants.

“We are seeing steady growth in customer metrics with MoM gains in both AOV and footfalls,” PL Capital noted in its report.

Westlife Foodworld: Gradual but Uneven Recovery

Westlife, which runs McDonald’s in West and South India, is showing gradual improvement in dine-in demand. However, recovery remains uneven across store locations. Urban stores relocated to high footfall areas have posted stronger numbers, with some outlets clocking ~₹7 crore in monthly revenue and delivering store-level margins of 30–35%, well above the company’s restaurant average.

Combo meals remain key volume drivers. The McSaver bundles—especially McAloo Tikki and McChicken variants—have outperformed premium SKUs. New launches such as the Korean spicy range received good initial traction among Gen-Z audiences but saw weak repeat purchases.

Restaurant Brands Asia: Volume Pickup, But Innovation Trails

Restaurant Brands Asia (Burger King India) has also seen an improvement in summer footfalls, helped by aggressive discounting strategies such as slashing milkshake prices from ₹199 to ₹99. The recently launched BK Express delivery model is aimed at reducing dependence on aggregators.

While the AOV in high catchment areas stands at ~₹350, the company continues to face stiff competition in the burger segment. Product innovation is on a three-month cycle, with the latest Korean-themed menu launched two months ago. However, sustained consumer stickiness remains low.

Financial Snapshot of Key QSR Players

CMP as on June 20.

Outlook

QSR growth in FY26 is expected to be led by urban consumption recovery and a continued focus on value-led offerings. Domino’s is likely to maintain its lead due to consistent menu innovation and strong delivery capabilities. Westlife is showing green shoots in high-footfall clusters but needs to improve product retention. Burger King’s progress will depend on the performance of new formats like BK Express and the ability to sustain promotional volumes.

Valuation View

PL Capital retains a ‘Hold’ rating on Jubilant FoodWorks with a target price of ₹689, noting its stable operating profile and improving delivery channel metrics. Westlife Foodworld is also rated ‘Hold’ with a target price of ₹738, while Restaurant Brands Asia is rated ‘Accumulate’, with room for valuation upside if volumes sustain and margins improve.

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