About
Jubilant Foodworks Ltd
Jubilant FoodWorks Limited (JFL), part of the Jubilant Bhartia Group, is India's largest food service Company that operates brands like Domino's Pizza, Dunkin' Donuts and Hong's Kitchen. It recently added Indian cuisines like biryani, kebabs, Indian breads and more to the portfolio by launching Ekdum across three restaurants in Gurugram. In response to shifting consumption habits, Company has begun offering their brandowned, ready-to-cook range, ChefBoss, comprising sauces, gravies and pastes. It also signed an exclusive Master Franchise and Development Agreement, to develop and operate Popeyes restaurants in India, Bangladesh, Nepal and Bhutan.
The Domino's Pizza brand is owned by Domino's Pizza, USA and is highly respected globally. Domino's Pizza USA is the recognised world leader in pizza delivery operating a network of company-owned and franchise-owned stores in the United States and international markets. Dunkin' Donuts, USA is the world's leading baked goods and coffee chain.
JFL's Domino's pizza stores in India are generally located in neighborhood markets in urban areas. They also operate pizza stores located in food courts in shopping malls and in institutional campuses.
Jubilant FoodWorks Ltd was incorporated on March 16, 1995 as a Private Limited Company with the name Domino's Pizza India Pvt. Ltd. The Company entered into a master franchise agreement with Domino's International for north and west regions in India.
In January 1996, the company opened their first Domino's pizza store. In September 14, 1996, the company was converted into a public limited company and the name was changed to Domino's Pizza India Ltd. In the year 1998, they extended master franchise agreement with Domino's International to whole of India and Nepal.
In the year 2001, the company made a tie-up with Hindustan Coca-Cola Beverages Pvt Ltd. In the year 2003, they became the subsidiary of Jubilant Enpro Pvt Ltd. In the year 2004, they launched '30 minutes or free' campaign. In the year 2005, the company entered into master franchise agreement for Sri Lanka and Bangladesh.
In the year 2009, the company launched 'Pizza Mania'. Also, they began to offer pasta and choco lava cake to their customers as a side item. They opened 60 new stores during the financial year 2008-09.
In September 17, 2009, the company entered into a trademark license agreement with Domino's International whereby Domino's International conferred on the company a non-exclusive right to use the trademarks and service marks ('Domino's Trademarks') in India.
In September 23, 2009, the company entered into an agreement with Domino's International for the grant of the exclusive right and license to establish and operate a commissary and to sell and distribute products using the know-how in the Territory and the exclusive right and license to prepare, process and produce Products using the technical knowledge in the Territory.
In September 24, 2009, the company changed their name from Domino's Pizza India Ltd to Jubilant FoodWorks Ltd. The company plans to open between 65 and 70 stores during the financial year 2009-10, of which they opened 31 stores as of November 30, 2009 in the existing cities.
As of November 30, 2009, the company operated 286 stores in India located in 22 states and union territories, including in 59 cities across the country, and, through a sub-franchisee, DP Lanka, five stores in Sri Lanka. As of November 30, 2009, we did not operate any stores in Nepal and Bangladesh.
Encouraged by the success of Domino's Pizza in India, Jubilant FoodWorks (JFL) leveraged its experience and expertise in the food service industry to introduce Dunkin' Donuts in India in FY 2012.
During the financial year ended 31 March 2014, Domino's Pizza India (DPI) successfully launched 150 new Domino's Pizza restaurants as against 111 restaurants in the previous year. A total of 27 new cities were added to DPI footprint during FY2014. During the year, Domino's Pizza India captured the consumers' interest and market by launching the new indulgent Fresh Pan Pizzas, Spicy Baked Chicken, Lebanese rolls and Calzone Pockets. The company continued to work towards rejuvenating its brand with innovative initiatives like launch of Pizza Theatre and strengthened its consumer connect.
DPI crossed the 600th restaurant milestone with the launch of its first Pizza Theatre at Vasant Kunj, New Delhi in August 2013. DPI crossed 700th mark with its restaurant in Gurgaon in March 2014.
During the year under review, DPI adopted the Pizza Theatre' design - a new global Domino's Pizza Restaurant design. The design enhances the consumer engagement and experience by having a one of its kind open display kitchen and restaurant layout in the QSR category. Of the total restaurants opened in FY 2014, 69 restaurants were on Pizza Theatre design.
The subdued external environment resulted in moderation of Domino's Pizza Same Restaurant Sales Growth (SSG) from 16.2% in FY 2013 to 1.6% in FY 2014. The moderation is measured against the higher base due to the fast-paced growth witnessed year-on-year since FY 2010, and in the context of the overall economic scenario which was driven by cautious consumer spends.Dunkin' Donuts' restaurants offering a wide variety western, all day part food menu including donuts, coffee, burgers, sandwiches, snacks and more, continued its expansion plans. The company successfully launched 16 new Dunkin' Donuts restaurants during the year, taking the total number to 26 restaurants as on March 31, 2014. During the year, Dunkin' Donuts' restaurants launched 'Get Your Mojo Back' positioning, aimed to get Dunkin' Donuts better placed in the sweet spot between the QSR and the Caf markets.During the year under review, Jubilant FoodWorks made higher investments in building the infrastructure necessary to meet the future requirements. While expanding and strengthening the existing manufacturing locations / commissaries - Noida, Mohali, Mumbai, Kolkata and Bengaluru, the company commenced work on three new commissaries, namely Hyderabad, Nagpur and Guwahati.
Jubilant FoodWorks' Sri Lankan subsidiary, Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) expanded its base by opening 5 restaurants during FY2014, taking its total restaurant count to 11 as on March 31, 2014. During the year under review, JFLPL launched 3new products, Pepper Chicken Drumsticks, Rice and Fresh Pan Pizza, which received encouraging response from the consumers. Though the overall sales grew, JFLPL continued to incur losses. Raw material cost continued to be high due to inflation and increased duty on cheese. Decisions and strategic choices continued to be guided by the principle of systematic expansion backed by strong infrastructure.
During the financial year ended 31 March 2015, Domino's India crossed the UK restaurant count and became the largest market for Domino's Pizza worldwide, outside USA. During the year the company achieved its target of opening 150 new Domino's Pizza restaurants set at the start of the year. The company pursued steady expansion in 46 new cities during the year in a focused move aimed at countering the high level of cannibalisation in the major cities. During the year under review, Domino's Pizza India (DPI) launched the highest number of products in its history, creating more occasions for ordering from Domino's Pizza. DPI changed its home delivery policy during the year to allow home delivery of only side products too. The restrained external environment dampened Domino's Pizza Same Store Sales Growth (SSG), which remained flat at 0.05% in FY 2015 as against 1.6% in FY 2014. The SSG moved into positive territory from Q3 FY 2015, after being in the negative space for the previous four quarters.
During the year Dunkin Donuts' expansion remained well on track. Enthused by the consumer's response, the company set up 28 new restaurants in FY 2015, taking Dunkin Donuts tally to 54 restaurants in 19 cities as on March 31, 2015. Resonating with the brand positioning of 'Get Your Mojo Back', Dunkin' Donuts launched several innovative products that can best - fulfill the evolving and emerging needs of the urban youth. The Crunchy Joe Burger, Tough Guy Brute Burger, Wicked Wraps and Not So Wicked Wraps, Naughty Lucy Burger and a new range of Donuts are among the new products launched during the year to bring alive the distinct brand positioning. Dunkin' Donuts also extended the range of Dunkaccino Coffee with new flavours such as Mocha Chip, Jamaican Rum and Almonds Dunkaccino. The beverage menu also saw the addition of two new - Green Iced Teas - Spiked Iced Tea and Green Iced Tea to beat the summer heat.
Jubilant FoodWorks's new manufacturing capabilities, known as commissaries/centralised food production facilities, at Nagpur, Guwahati and Hyderabad became operational in FY 2015.
During the year under review, Jubilant FoodWorks's wholly owned subsidiary Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) launched 4 new Domino's Pizza Restaurants, taking its total restaurant count to 15 as on March 31, 2015. During the financial year ended 31 March 2016, Domino's Pizza India (DPI) continued on its strong growth path marked by the accomplishment of reaching 1000th restauant. With the 1000th restaurant, India joins the USA, where the brand has been operating since 1960, to become the only other country with over 1000 restaurants. Continuing with its systematic approach to expansion, DPI achieved the target of opening 150 new restaurants. DPI entered 39 new cities during the year. During the year under review, DPI launched Chef's range of exotic Italian pizzas and double crunch pizzas. In the first initiative of its kind, DPI launched 100% Vegetarian Navaratri menu at select Restaurants, to give consumers the freedom to enjoy their pizzas without any inhibitions, which was extremely well-received. DPI launched a new mobile ordering application during FY 2016 that enables enhanced user interface and experience. The DPI website was also revamped to keep pace with evolving digital trends and to increase the convenience of ordering online.
The Pizza Theatre design, which has an open display kitchen, was further upgraded and the new design - Pizza Theatre Plus was unveiled at the launch of the 1,000th Restaurant. A new format - 'Domino's On-the-Go' was launched. These are located at transit points where footfalls are usually very high and average ticket price low. To ensure that orders can be turned around quickly, these formats feature a shorter menu.
Dunkin' Donuts India (DDI) on the other hand, continued to expand gradually across existing and new cities in India. Consistent with the brand's strategy to steadily expand presence across new cities and simultaneously broaden accessibility at existing cities, 20 new DDI Restaurants were opened during the year under review. During the year, DDI decommissioned 3 restaurants and revised the restaurant opening target downwards. In Dunkin' Donuts, focus was on innovation across all day part food items that resulted in latest innovation and menu addition which are Donut cakes marking the Company's entry into the packaged food segment. With a view to attract new consumers, reinvigorate interest and drive repeat orders, menu innovation were done with the launch of Too Much Burgers, Voodoo Wraps, Coolattas along with the fresh range of Coffees which received an outstanding consumer response.
Jubilant FoodWorks' Same-Restaurant Sales Growth (SSG) stood at 3.2% in FY 2016 as against 0.05% growth in FY 2015.
During the year under review, Jubilant FoodWorks's wholly owned subsidiary Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) continued to expand steadily Domino's Pizza brand in Sri Lanka. During the year, JFLPL launched five new Domino's Pizza Restaurant, taking its total Restaurant count to twenty as on March 31, 2016. To bolster technology, JFLPL successfully launched its Online Ordering (OLO) and the mobile app for Mobile ordering.
FY 2017 was a year of designing and implementing strategy for driving the company's evolution to the next phase of profitable growth. During FY 2017, Jubilant FoodWorks continued to focus on optimum network expansion and driving technology platform to enhance the customer experience and improving operational efficiency. The company invested and implemented initiatives to deliver long-term growth for its business, while closely managing the short-term events which influence performance. While the economic growth momentum was temporarily impacted with demonetization during the year, the company sustained its focus on the cost rationalisation and improving efficiencies.
Domino's Pizza and Dunkin' Donuts Restaurant network expansion was focused on alignment with the Return on Investment (ROI) norms of the company and the external operating environment. The company increased its reach amongst relevant consumers by entry of Domino's Pizza in the State of Nagaland. During FY 2017, Domino's Pizza India ()DPI) opened 103 new Restaurants and entered 29 new cities, which have further broadened accessibility in existing geographies and established DPI's presence in new cities and towns. An important milestone of the year was the opening of the the1100th Restaurant. During the course of the year, 14 DPI Restaurants were decommissioned guided by stringent ROI norms. During the year, DPI won the bid to open a Restaurant at Agra Railway station and outside the Patna airport. DPI's Same Restaurant Sales Growth (SSG) for the year stood at negative 2.4%.
With the launch of Burger Pizza, the company aimed to grow its share in the all day, individual consumption' occasion and further grow its share in the chained Indian Food Service Industry. Burger Pizza and Pizza Mania Extremes were among the two most innovative products launched targeted to delight consumers, met with good response and achieved the internal launch objectives.
Dunkin' Donuts India (DDI) on the other hand, continued its efforts to strengthen its position in the sweet spot between the QSR and the Caf markets. Continuous and renewed efforts were made to improve beverage and donut sales and bringing value offerings to food range. A number of product launches were made to cater rapidly evolving consumer taste and preferences such as Big Joy Burger, Munchkins, Eggless Donuts Cakes and DunkyDoos - a new range of donuts for the young guests. The range of Big Joy Burger was extremely popular with the consumers. DDI followed a prudent and judicious expansion strategy with the focus of getting proper return on investment. 12 new Restaurants were opened during the year. Aligned to the Company's objective of profitable growth, 20 Restaurants were decommissioned as they failed to deliver on the Company's expected ROI parameters.
During the year under review, Jubilant FoodWorks' subsidiary Jubilant FoodWorks Lanka (Private) Limited (JFLPL) launched 3 new Domino's Pizza Restaurant, taking its total Restaurant count to 23 as on March 31, 2017. Through steady expansion of the restaurant network, new restaurants were launched in Kalutara, Kotahena and Boralesgamuwa, marking Domino's Pizza foray in these cities. In addition to providing consumers with differentiated and innovative choices, the menu was revamped during the year and now it is catering completely to the Sri Lankan taste. Through ongoing aggressive marketing communication and promotion strategy together with enhancement of operational service level, JFLPL aimed to reach out to more consumers and generate brand loyalty. The Restaurants maintained a healthy same Restaurant sales growth (SSG) of 20%.
During the financial year ended 31 March 2018, Jubilant FoodWorks identified key driving the strategic pillars of product and innovation, value for money, customer experience, digital and technology while bringing cost optimization with a clear focus on sustainable growth. The company's emphasis on driving the key strategic pillars translated into healthy same store sales growth YoY, while setting the base for consistent growth in line with the potential of the Quick Service Restaurant (QSR) space. The lowering in rate of applicable GST to 5% allowed the company to demonstrate its commitment to deliver the best value proposition as the company passed on the benefits of lower tax rate to the customers while taking a small calibrated price increase on few products to partially cover for the input credit loss.
Domino's Pizza India's (DPI) Same-Restaurant Sales Growth (SSG) witnessed a strong revival during the year at 13.9%. SSG is a key financial metric in the QSR industry, and the recovery indicates increase in frequency and value of ordering by existing and new customers. During the year, DPI continuously focused on Innovation for resonating with consumers' evolving tastes and meeting their expectations. With the launch of All New Domino's', Domino's Pizza unveiled its most significant product refresh with an across the board enhancement of its pizzas delighting consumers with the choicest taste and best quality. The upgrade in core pizzas saw massive acceptance as reflected in new consumer acquisition as well as increase in existing consumer's frequency. Further diversifying its side product offering, DPI launched three new formats of chicken products with international flavours. The company successfully added 24 Restaurants during the year. DPI's network spanned across 266 cities as on March 31, 2018, as against 264 cities as on March 31, 2017. Seven Restaurants were decommissioned during the year as they failed to deliver on the Company's expected ROI parameters. As of March 31, 2018, the DPI network comprised 1,134 Restaurants as against 1,117 Restaurants as on March 31, 2017.
Matching pace with the changing lifestyle of customers, DPI launched late-night delivery across multiple cities. As on March 31, 2018, this facility was available across 7 Cities and 52 Restaurants. This new growth vector created positive brand association and connect with younger audience.
At Dunkin' Donuts India (DDI), a new focus was brought on beverage and donuts, while food continued to be a strong play. The focused strategy of enhancing core offerings, driving efficiencies along with shutdown of unprofitable stores led to significant reduction in DDI losses. DDI has also experimented with smaller Restaurant size. As an innovation, DDI launched Value range of donuts and signature donuts including Chocotella, White Choco Cheesecake, Choco Symphony and Coffee Toffee. Shaken Iced Coffee, Caramel Hazelnut Latte and Tiramisu Latte were among the new beverages launched during the year. On the food side, Toasties (Chilli Cheese and Chicken) and Big Joy Mayo Burger were added to the menu. DDI drove Value for Money by introducing a range of donuts at Rs 49 and also introduced a Donut+Coffee combo at Rs 89 with the objective of seeding the Donuts + Coffee habit. DDI was cautious in its expansion strategy aligned to the company's overarching strategy of profitable growth. Five new Restaurants were opened in FY 2018 while 31 Restaurants were decommissioned. The total number of DDI Restaurants stood at 37 as on March 31, 2018 as against 63 as on March 31, 2017.
In the fourth quarter of FY 2018, the Company commissioned its state-of-the-art facility in Greater Noida, a prestigious accomplishment for the Company that will give a better overall efficiency at the commissary level as well. It is the largest facility in the entire Domino's Pizza worldwide, as on date of report. The first to be fully owned and operated by Jubilant FoodWorks (JFL), the Greater Noida facility will be supplying food and non-food ingredients. It has the capacity to supply to around 550 DPI and 100 DDI Restaurants, reducing the need for outsourcing. This highly automated facility will make greater cost and quality control possible.
During the year ended 31 March 2018, the company's wholly owned subsidiary Jubilant FoodWorks Lanka (Private) Limited (JFLPL) launched one new Domino's Pizza Restaurant, taking its total Restaurant count to 24 (twenty four) as on March 31, 2018. In line with DPI, Every Day Value proposition was also rolled out for Sri Lanka business. New pizzas and sides were introduced in the menu to fuel excitement among the consumers.
During the year ended 31 March 2018, Jubilant FoodWorks announced joint venture with Golden Harvest QSR Ltd. (Golden Harvest), part of Golden Harvest group of Bangladesh to launch Domino's Pizza Restaurants in Bangladesh. For the purpose of this joint venture, a private limited company, Jubilant Golden Harvest Limited (JGHL) was incorporated. Jubilant FoodWorks will be the majority shareholder with 51% of the total shareholding, while Golden Harvest will hold the balance 49% in the joint venture company.
As on 31 March 2018, JFL had 1,134 Domino's Pizza Restaurants across 266 cities and 37 Dunkin' Donuts Restaurants across 10 cities. JFL has 11 Commissaries/Supply Chain Centres (SCCs) at strategic locations around India. These serve as manufacturing and distribution facilities for DPI and DDI, thus enabling the company to achieve economies of scale.
The Board of Directors of Jubilant FoodWorks at its meeting held on 08 May 2018, recommended issue of bonus shares in the proportion of 1 equity share of Rs 10/- each fully paid up for every 1 equity share of Rs 10/- each fully paid up as on the record date fixed for this purpose. The company has allotted 65,984,520 bonus shares on 26 June 2018 to the shareholders.
During the FY2019,the company opened 102 new restaurants Domino's Pizza and that took the total of 1227 Domino's Pizza Restaurants across 273 cities and and 31 Dunkin' Donuts Restaurants across 10 cities.in India.
During the year 2018-19,the company has further invested an amount of Rs 992.03 lakhs in its whollyowned subsidiary Jubilant FoodWorks Lanka Pvt Ltd.Further the company has invested an amount of Rs 456.58 lakhs representing 51% stake in joint venture Jubilant Golden Harvest Ltd.
As on 31 March 2020, Domino's Pizza India has a network of 1,335 restaurants across 282 cities. JFL also has exclusive rights for developing and operating Dunkin' Donuts restaurants in India, with 34 restaurants under the brand across 10 cities.The company also have 4 Hong's Kitchen.
The Company has an investment of Rs 9,690.11 lakhs (Previous year Rs 9,209.09 lakhs) (includes investment made during the FY2020 Rs 481.02 lakhs) in it wholly owned subsidiary Company Jubilant FoodWorks Lanka (Private) Limited as on 31 March 2020 to cater to the geographical market of Sri Lanka. Further, during the current year the Company has invested Rs 985.56 lakhs (Previous year Rs 456.58 lakhs) and as at 31 March 2020 the Company has an investment of Rs 1,442.14 lakhs (Previous year Rs 456.58 lakhs) in Jubilant Golden Harvest Ltd to cater to the geographical market of Bangladesh.
The company opened 134 new Domino's Pizza restaurants in FY 2021, surpassing the initial plan of opening 100. Also unveiled 7 new restaurants in our international markets, 5 in Sri Lanka and 2 in Bangladesh.As on 31 March 2021,the Company has 1,360 Domino's Pizza Restaurants, 24 Dunkin' Donuts Restaurants, 8 Hong's Kitchen and 4 Ekdum! Restaurants.
The Company has an invesment of Rs 9,978.13 lakhs (Previous Year Rs 9,690.11 lakhs) (includes investment made during the FY2021 Rs 288.02 lakhs) in its wholly owned subsidiary Company Jubilant FoodWorks Lanka (Private) Limited as on 31 March 2021 to cater to the geographical market of Srilanka.
During the year 2019-20, the Company has entered into an exclusive Master Franchise and Development Agreement with PLK APAC Pte. Ltd., a subsidiary of Restaurant Brands International Inc., to develop, establish, own and operate, and to license Franchisees to develop, establish, own and operate, Popeyesr Restaurants in India, Bangladesh , Nepal and Bhutan.
During the financial year 2019-20,Jubilant Foodworks Netherlands B.V. (JFN') was incorporated as a wholly-owned subsidiary of the Company in Netherlands.The Company acquired Fides Food Systems Cobperatief U.A. at a consideration of equivalent Rs 25,280.09 lakhs paid through its wholly owned subsidiary Jubilant Foodworks Netherlands B.V. in the Netherlands. Fides Food Systems Cobperatief U.A. holds 32.81 % equity shares in DP Eurasia N.V. ('DP Eurasia'). DP Eurasia is a public company listed with London Stock Exchange PLC, and is the exclusive master franchisee of the Domino's Pizza brand in Turkey, Russia, Azerbaijan and Georgia.
During the financial year 2022-23, the Company acquired 49% equity stake in Jubilant FoodWorks Bangladesh Limited and after acquisition, Jubilant Bangladesh became wholly owned subsidiary of the Company effective May 10, 2022. Resulting to this, the name of the Company was changed from Jubilant Golden Harvest Limited to Jubilant FoodWorks Bangladesh Limited with effect from July 7, 2022.
Jubilant FoodWorks International Investments Limited was incorporated as a wholly owned subsidiary of the Company in India on August 8, 2022. Hashtag g Loyalty Private Limited became an associate company on acquisition of 35% stake (on fully diluted basis) w.e.f. March 31, 2022. Further, Hashtag got into a Securities Subscription Agreement with new investor, who had acquired 15% stake in Hashtag, and accordingly, the Company's stake in Hashtag reduced from 35% to 29.75%.
Wellversed became an associate company on acquisition of 25.02% stake (on fully diluted basis) on May 2, 2022. The Company acquired 40% stake in Roadcast Tech Solutions Private Limited and Roadcast was made an associate Company effective September 29, 2022.
The Company added 13 stores taking the network tally to 48 stores in March 2023. During the year 2023, the Company introduced an all new Domino's Pizza Mania range comprising of four pizzas with two new sauces - Desi Makhani and Videshi(Hot and sweet). It stepped up network expansion in Bangladesh and grew the network from 9 stores at end of FY'22 to 17 stores by end of FY'23.
Jubilant Foodworks Ltd
Chairman Speech
The fiscal year 2022-23 was a landmark year for your Company for many
reasons: We are pleased to share with you that we became the first foodservice company in
India to surpass the turnover of R 50,000 million in fiscal year 2022-23, while delivering
industry-leading margins.
After having pioneered the 30-minute delivery promise since 2004, we
raised the consumer service bar this year by launching the 20-minute delivery promise in
Bengaluru. With this, an Indian city became the first across all Domino's markets
globally to offer such a unique proposition We opened a record 250 new Domino's
stores in a year. This is the highest addition across all Domino's markets by a
single franchise We enrolled 13.6 million loyalty members for Domino's Cheesy
rewards, within a year of its launch. The order contribution is at a staggering 45% in
March 2023 We became the first QSR Company to launch dedicated regional menu innovation We
have been recognised as a Great Place to Work, which reflects our high-trust,
high-performance culture.
As we look back to the significant milestones we have traversed with
the support of all stakeholders, we are encouraged by the Company's progress.
Building for the long-term
Our success has always been based upon our ability to evaluate the
environment in which we operate, look ahead and prepare ourselves to seize opportunities
to deliver profitable growth, now and in the future. We would like to put the spotlight on
two of our guiding principles in the journey: Delighting consumers with incessant focus on
value and innovation Taking a long view and making proactive investments to continuously
fortify our operating model.
These guiding principles have held us in good stead in all these years.
The JFL operating model is honed by a built-to-last culture and an unwavering financial
discipline, which have set into motion a virtuous cycle of profitable growth, while
building a unique assemblage of strengths for your Company.
These strengths comprise our resilient and robust pan-India supply
chain, digital and data capabilities, business development capabilities and other support
functions. The combination of these shared strengths are huge assets for us, which will
help us transform into a multi-brand and multi-country food service organisation.
To our mind, the opportunity landscape is so large, that driven by the
entrepreneurial zeal, we collectively feel that we have just begun. Take for instance the
pizza market. The global pizza market is valued at $120 bn and is growing. Within it QSR
is $81 bn. Within it, US alone is $40 bn, while the Indian pizza market is at $0.9 bn and
even the total organised QSR market in India is under $2.5 bn. We will therefore continue
to make investments for the long-term growth and health of the business.
Performance – Constant Rebalancing
The Company's performance during the year was a tale of two
halves. As the Covid pandemic waned, there was a surge in demand for out-of-home
consumption in the first half. However, post the festival season, there was sudden
deceleration in demand as rampant inflation started exerting pressure on discretionary
consumption.
On the cost side, we witnessed broad-based inflation across categories
during the year. To help you better appreciate the impact of inflation on some of our key
ingredients, if we index the prices to pre-Covid levels, in FY'23, the cheese price
has increased by 40%, flour price by 28%, chicken and paper box prices by 30%. The cheese
prices, which were already at a decadal high in the second half of the fiscal year, are
expected to remain elevated in the coming quarters as well.
We faced a choice in how to react to these challenges. In this moment,
like in the past, we sided with our guiding principles. As consumer's discretionary
income remains under pressure, we are channelising our efforts to pursue order-led growth
by further strengthening our value offerings. The launch of a new range of Pizza Mania for
example, will help us enhance category recruit and in future we would be able to upgrade
them and benefit from higher customer life-time value. It is important to highlight here
that the strength of our sourcing and unique-commissary model lends us the ability to
bolster value offerings, without negatively impacting our gross margins. Therefore, even
in challenging times like these, we will continue to make investment decisions in the
light of long-term considerations, which will help us serve our consumers the highest
quality food offerings at affordable price points. We are delighted to share with you that
our largest commissary in Bengaluru will be commissioned in August. The state-of-the-art
facility would be able to serve more than 750 stores in the future. All the workstreams to
commission another mega commissary in Mumbai next year, are progressing well. The CAPEX
for both the commissaries is estimated at H 5,200 million, but their lasting benefits will
be realised for decades.
At H 50,960 million, our Revenue from Operations increased by 17.7%.
The Domino's LFL and SSG growth stood at 8.9% and 6.0%, respectively. The EBITDA
stood at H 11,592 million, and EBITDA margin at 22.7%. Our Profit after Tax and before
exceptional items was H 4,029 million and margin came in at 7.9%.
Our track record of generating strong free cash flow continued in the
year. We are happy to share that the Board of Directors of the Company has recommended a
dividend of H 1.2 per equity share of the face value of H 2 each amounting to H 791.8
million, subject to shareholders' approval at the Annual General Meeting.
Strategic Portfolio Management
After a lot of internal deliberations and careful review, we have
decided to wind down the operation of our RTC brand – ChefBoss – and scale down
the network of Ekdum!. We want to focus our attention and resources on doubling down on
Domino's and scaling up Popeyes, while working on unit economics delivery of other
emerging brands – Dunkin' and Hong's Kitchen.
Popeyes has received overwhelming response from Indian consumers. In
the last one year, nearly one million guests in Bengaluru and Chennai have tried the
iconic Popeyes menu, suitably adapted to cater to the diverse taste palates of Indian
guests.
In Hong's Kitchen, we have seen remarkable progress with further
enhancement in taste, improvement in repeat rates, increase in orders and record high NPS.
In Dunkin', during the quarter, we unveiled a new restaurant
design in India as part of Inspire brand's global coffee-forward evolution. The
entire brand overhaul reflects our intent to be young-at-heart, go-to coffee destination.
The coffee retail category is constantly expanding, and Dunkin' will continue to
innovate fast and will strive to serve the best coffee and bakery products to our
consumers.
In Sri Lanka and Bangladesh, we continue to deploy the emerging market
playbook for Domino's with cuisine localisation, offering the best value to
consumers, unmatched delivery credentials and best-in-class digital assets. During the
year, in Sri Lanka, we managed the business well, despite the prevailing macro-economic
scenario, while adding 13 stores and taking the network tally to 48 stores. In Bangladesh,
after fully acquiring the local subsidiary, we stepped up the pace of network expansion
and enhanced the network to 17 stores.
Jubilant for All
‘Jubilant for All' symbolises how we work to create enduring
value, which delights not only consumers but all the stakeholders in the process through
sustained profitable growth. We have tried to depict the subset of such sustainability
measures through what goes behind delivering a hot and fresh pizza to consumers in under
20 minutes.
Sustainability is deeply embedded in our multi-stakeholder business
model, as a key tenet of generating long-term value. We are delighted to present your
Company's first Integrated Report, along with the Business Responsibility and
Sustainability Report. We have also shared the multi-year, time-bound goals, anchored
around Food, Planet, People and Communities and Governance. The Sustainability and CSR
Committee of the Board is responsible for overseeing and guiding our sustainability
strategy, performance and its implementation.
We would also like to welcome Mr. Amit Jain who has joined our Board in
July as an Independent Director. He is currently the Chairman of Loreal India and also the
Chairperson of Modern Marketing Association(MMA) India. His wealth of experience and
knowledge of the consumer sector would be of immense benefit to the Company.
The Board acknowledges that perpetual efforts and continued progress
towards enhancing the implementation of sustainability principles is the only way we
intend to traverse, while charting our journey of sustained profitable growth.
| Shyam S. Bhartia |
Hari S. Bhartia |
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Jubilant Foodworks Ltd
Company History
Jubilant FoodWorks Limited (JFL), part of the Jubilant Bhartia Group, is India's largest food service Company that operates brands like Domino's Pizza, Dunkin' Donuts and Hong's Kitchen. It recently added Indian cuisines like biryani, kebabs, Indian breads and more to the portfolio by launching Ekdum across three restaurants in Gurugram. In response to shifting consumption habits, Company has begun offering their brandowned, ready-to-cook range, ChefBoss, comprising sauces, gravies and pastes. It also signed an exclusive Master Franchise and Development Agreement, to develop and operate Popeyes restaurants in India, Bangladesh, Nepal and Bhutan.
The Domino's Pizza brand is owned by Domino's Pizza, USA and is highly respected globally. Domino's Pizza USA is the recognised world leader in pizza delivery operating a network of company-owned and franchise-owned stores in the United States and international markets. Dunkin' Donuts, USA is the world's leading baked goods and coffee chain.
JFL's Domino's pizza stores in India are generally located in neighborhood markets in urban areas. They also operate pizza stores located in food courts in shopping malls and in institutional campuses.
Jubilant FoodWorks Ltd was incorporated on March 16, 1995 as a Private Limited Company with the name Domino's Pizza India Pvt. Ltd. The Company entered into a master franchise agreement with Domino's International for north and west regions in India.
In January 1996, the company opened their first Domino's pizza store. In September 14, 1996, the company was converted into a public limited company and the name was changed to Domino's Pizza India Ltd. In the year 1998, they extended master franchise agreement with Domino's International to whole of India and Nepal.
In the year 2001, the company made a tie-up with Hindustan Coca-Cola Beverages Pvt Ltd. In the year 2003, they became the subsidiary of Jubilant Enpro Pvt Ltd. In the year 2004, they launched '30 minutes or free' campaign. In the year 2005, the company entered into master franchise agreement for Sri Lanka and Bangladesh.
In the year 2009, the company launched 'Pizza Mania'. Also, they began to offer pasta and choco lava cake to their customers as a side item. They opened 60 new stores during the financial year 2008-09.
In September 17, 2009, the company entered into a trademark license agreement with Domino's International whereby Domino's International conferred on the company a non-exclusive right to use the trademarks and service marks ('Domino's Trademarks') in India.
In September 23, 2009, the company entered into an agreement with Domino's International for the grant of the exclusive right and license to establish and operate a commissary and to sell and distribute products using the know-how in the Territory and the exclusive right and license to prepare, process and produce Products using the technical knowledge in the Territory.
In September 24, 2009, the company changed their name from Domino's Pizza India Ltd to Jubilant FoodWorks Ltd. The company plans to open between 65 and 70 stores during the financial year 2009-10, of which they opened 31 stores as of November 30, 2009 in the existing cities.
As of November 30, 2009, the company operated 286 stores in India located in 22 states and union territories, including in 59 cities across the country, and, through a sub-franchisee, DP Lanka, five stores in Sri Lanka. As of November 30, 2009, we did not operate any stores in Nepal and Bangladesh.
Encouraged by the success of Domino's Pizza in India, Jubilant FoodWorks (JFL) leveraged its experience and expertise in the food service industry to introduce Dunkin' Donuts in India in FY 2012.
During the financial year ended 31 March 2014, Domino's Pizza India (DPI) successfully launched 150 new Domino's Pizza restaurants as against 111 restaurants in the previous year. A total of 27 new cities were added to DPI footprint during FY2014. During the year, Domino's Pizza India captured the consumers' interest and market by launching the new indulgent Fresh Pan Pizzas, Spicy Baked Chicken, Lebanese rolls and Calzone Pockets. The company continued to work towards rejuvenating its brand with innovative initiatives like launch of Pizza Theatre and strengthened its consumer connect.
DPI crossed the 600th restaurant milestone with the launch of its first Pizza Theatre at Vasant Kunj, New Delhi in August 2013. DPI crossed 700th mark with its restaurant in Gurgaon in March 2014.
During the year under review, DPI adopted the Pizza Theatre' design - a new global Domino's Pizza Restaurant design. The design enhances the consumer engagement and experience by having a one of its kind open display kitchen and restaurant layout in the QSR category. Of the total restaurants opened in FY 2014, 69 restaurants were on Pizza Theatre design.
The subdued external environment resulted in moderation of Domino's Pizza Same Restaurant Sales Growth (SSG) from 16.2% in FY 2013 to 1.6% in FY 2014. The moderation is measured against the higher base due to the fast-paced growth witnessed year-on-year since FY 2010, and in the context of the overall economic scenario which was driven by cautious consumer spends.Dunkin' Donuts' restaurants offering a wide variety western, all day part food menu including donuts, coffee, burgers, sandwiches, snacks and more, continued its expansion plans. The company successfully launched 16 new Dunkin' Donuts restaurants during the year, taking the total number to 26 restaurants as on March 31, 2014. During the year, Dunkin' Donuts' restaurants launched 'Get Your Mojo Back' positioning, aimed to get Dunkin' Donuts better placed in the sweet spot between the QSR and the Caf markets.During the year under review, Jubilant FoodWorks made higher investments in building the infrastructure necessary to meet the future requirements. While expanding and strengthening the existing manufacturing locations / commissaries - Noida, Mohali, Mumbai, Kolkata and Bengaluru, the company commenced work on three new commissaries, namely Hyderabad, Nagpur and Guwahati.
Jubilant FoodWorks' Sri Lankan subsidiary, Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) expanded its base by opening 5 restaurants during FY2014, taking its total restaurant count to 11 as on March 31, 2014. During the year under review, JFLPL launched 3new products, Pepper Chicken Drumsticks, Rice and Fresh Pan Pizza, which received encouraging response from the consumers. Though the overall sales grew, JFLPL continued to incur losses. Raw material cost continued to be high due to inflation and increased duty on cheese. Decisions and strategic choices continued to be guided by the principle of systematic expansion backed by strong infrastructure.
During the financial year ended 31 March 2015, Domino's India crossed the UK restaurant count and became the largest market for Domino's Pizza worldwide, outside USA. During the year the company achieved its target of opening 150 new Domino's Pizza restaurants set at the start of the year. The company pursued steady expansion in 46 new cities during the year in a focused move aimed at countering the high level of cannibalisation in the major cities. During the year under review, Domino's Pizza India (DPI) launched the highest number of products in its history, creating more occasions for ordering from Domino's Pizza. DPI changed its home delivery policy during the year to allow home delivery of only side products too. The restrained external environment dampened Domino's Pizza Same Store Sales Growth (SSG), which remained flat at 0.05% in FY 2015 as against 1.6% in FY 2014. The SSG moved into positive territory from Q3 FY 2015, after being in the negative space for the previous four quarters.
During the year Dunkin Donuts' expansion remained well on track. Enthused by the consumer's response, the company set up 28 new restaurants in FY 2015, taking Dunkin Donuts tally to 54 restaurants in 19 cities as on March 31, 2015. Resonating with the brand positioning of 'Get Your Mojo Back', Dunkin' Donuts launched several innovative products that can best - fulfill the evolving and emerging needs of the urban youth. The Crunchy Joe Burger, Tough Guy Brute Burger, Wicked Wraps and Not So Wicked Wraps, Naughty Lucy Burger and a new range of Donuts are among the new products launched during the year to bring alive the distinct brand positioning. Dunkin' Donuts also extended the range of Dunkaccino Coffee with new flavours such as Mocha Chip, Jamaican Rum and Almonds Dunkaccino. The beverage menu also saw the addition of two new - Green Iced Teas - Spiked Iced Tea and Green Iced Tea to beat the summer heat.
Jubilant FoodWorks's new manufacturing capabilities, known as commissaries/centralised food production facilities, at Nagpur, Guwahati and Hyderabad became operational in FY 2015.
During the year under review, Jubilant FoodWorks's wholly owned subsidiary Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) launched 4 new Domino's Pizza Restaurants, taking its total restaurant count to 15 as on March 31, 2015. During the financial year ended 31 March 2016, Domino's Pizza India (DPI) continued on its strong growth path marked by the accomplishment of reaching 1000th restauant. With the 1000th restaurant, India joins the USA, where the brand has been operating since 1960, to become the only other country with over 1000 restaurants. Continuing with its systematic approach to expansion, DPI achieved the target of opening 150 new restaurants. DPI entered 39 new cities during the year. During the year under review, DPI launched Chef's range of exotic Italian pizzas and double crunch pizzas. In the first initiative of its kind, DPI launched 100% Vegetarian Navaratri menu at select Restaurants, to give consumers the freedom to enjoy their pizzas without any inhibitions, which was extremely well-received. DPI launched a new mobile ordering application during FY 2016 that enables enhanced user interface and experience. The DPI website was also revamped to keep pace with evolving digital trends and to increase the convenience of ordering online.
The Pizza Theatre design, which has an open display kitchen, was further upgraded and the new design - Pizza Theatre Plus was unveiled at the launch of the 1,000th Restaurant. A new format - 'Domino's On-the-Go' was launched. These are located at transit points where footfalls are usually very high and average ticket price low. To ensure that orders can be turned around quickly, these formats feature a shorter menu.
Dunkin' Donuts India (DDI) on the other hand, continued to expand gradually across existing and new cities in India. Consistent with the brand's strategy to steadily expand presence across new cities and simultaneously broaden accessibility at existing cities, 20 new DDI Restaurants were opened during the year under review. During the year, DDI decommissioned 3 restaurants and revised the restaurant opening target downwards. In Dunkin' Donuts, focus was on innovation across all day part food items that resulted in latest innovation and menu addition which are Donut cakes marking the Company's entry into the packaged food segment. With a view to attract new consumers, reinvigorate interest and drive repeat orders, menu innovation were done with the launch of Too Much Burgers, Voodoo Wraps, Coolattas along with the fresh range of Coffees which received an outstanding consumer response.
Jubilant FoodWorks' Same-Restaurant Sales Growth (SSG) stood at 3.2% in FY 2016 as against 0.05% growth in FY 2015.
During the year under review, Jubilant FoodWorks's wholly owned subsidiary Jubilant FoodWorks Lanka (Pvt.) Ltd. (JFLPL) continued to expand steadily Domino's Pizza brand in Sri Lanka. During the year, JFLPL launched five new Domino's Pizza Restaurant, taking its total Restaurant count to twenty as on March 31, 2016. To bolster technology, JFLPL successfully launched its Online Ordering (OLO) and the mobile app for Mobile ordering.
FY 2017 was a year of designing and implementing strategy for driving the company's evolution to the next phase of profitable growth. During FY 2017, Jubilant FoodWorks continued to focus on optimum network expansion and driving technology platform to enhance the customer experience and improving operational efficiency. The company invested and implemented initiatives to deliver long-term growth for its business, while closely managing the short-term events which influence performance. While the economic growth momentum was temporarily impacted with demonetization during the year, the company sustained its focus on the cost rationalisation and improving efficiencies.
Domino's Pizza and Dunkin' Donuts Restaurant network expansion was focused on alignment with the Return on Investment (ROI) norms of the company and the external operating environment. The company increased its reach amongst relevant consumers by entry of Domino's Pizza in the State of Nagaland. During FY 2017, Domino's Pizza India ()DPI) opened 103 new Restaurants and entered 29 new cities, which have further broadened accessibility in existing geographies and established DPI's presence in new cities and towns. An important milestone of the year was the opening of the the1100th Restaurant. During the course of the year, 14 DPI Restaurants were decommissioned guided by stringent ROI norms. During the year, DPI won the bid to open a Restaurant at Agra Railway station and outside the Patna airport. DPI's Same Restaurant Sales Growth (SSG) for the year stood at negative 2.4%.
With the launch of Burger Pizza, the company aimed to grow its share in the all day, individual consumption' occasion and further grow its share in the chained Indian Food Service Industry. Burger Pizza and Pizza Mania Extremes were among the two most innovative products launched targeted to delight consumers, met with good response and achieved the internal launch objectives.
Dunkin' Donuts India (DDI) on the other hand, continued its efforts to strengthen its position in the sweet spot between the QSR and the Caf markets. Continuous and renewed efforts were made to improve beverage and donut sales and bringing value offerings to food range. A number of product launches were made to cater rapidly evolving consumer taste and preferences such as Big Joy Burger, Munchkins, Eggless Donuts Cakes and DunkyDoos - a new range of donuts for the young guests. The range of Big Joy Burger was extremely popular with the consumers. DDI followed a prudent and judicious expansion strategy with the focus of getting proper return on investment. 12 new Restaurants were opened during the year. Aligned to the Company's objective of profitable growth, 20 Restaurants were decommissioned as they failed to deliver on the Company's expected ROI parameters.
During the year under review, Jubilant FoodWorks' subsidiary Jubilant FoodWorks Lanka (Private) Limited (JFLPL) launched 3 new Domino's Pizza Restaurant, taking its total Restaurant count to 23 as on March 31, 2017. Through steady expansion of the restaurant network, new restaurants were launched in Kalutara, Kotahena and Boralesgamuwa, marking Domino's Pizza foray in these cities. In addition to providing consumers with differentiated and innovative choices, the menu was revamped during the year and now it is catering completely to the Sri Lankan taste. Through ongoing aggressive marketing communication and promotion strategy together with enhancement of operational service level, JFLPL aimed to reach out to more consumers and generate brand loyalty. The Restaurants maintained a healthy same Restaurant sales growth (SSG) of 20%.
During the financial year ended 31 March 2018, Jubilant FoodWorks identified key driving the strategic pillars of product and innovation, value for money, customer experience, digital and technology while bringing cost optimization with a clear focus on sustainable growth. The company's emphasis on driving the key strategic pillars translated into healthy same store sales growth YoY, while setting the base for consistent growth in line with the potential of the Quick Service Restaurant (QSR) space. The lowering in rate of applicable GST to 5% allowed the company to demonstrate its commitment to deliver the best value proposition as the company passed on the benefits of lower tax rate to the customers while taking a small calibrated price increase on few products to partially cover for the input credit loss.
Domino's Pizza India's (DPI) Same-Restaurant Sales Growth (SSG) witnessed a strong revival during the year at 13.9%. SSG is a key financial metric in the QSR industry, and the recovery indicates increase in frequency and value of ordering by existing and new customers. During the year, DPI continuously focused on Innovation for resonating with consumers' evolving tastes and meeting their expectations. With the launch of All New Domino's', Domino's Pizza unveiled its most significant product refresh with an across the board enhancement of its pizzas delighting consumers with the choicest taste and best quality. The upgrade in core pizzas saw massive acceptance as reflected in new consumer acquisition as well as increase in existing consumer's frequency. Further diversifying its side product offering, DPI launched three new formats of chicken products with international flavours. The company successfully added 24 Restaurants during the year. DPI's network spanned across 266 cities as on March 31, 2018, as against 264 cities as on March 31, 2017. Seven Restaurants were decommissioned during the year as they failed to deliver on the Company's expected ROI parameters. As of March 31, 2018, the DPI network comprised 1,134 Restaurants as against 1,117 Restaurants as on March 31, 2017.
Matching pace with the changing lifestyle of customers, DPI launched late-night delivery across multiple cities. As on March 31, 2018, this facility was available across 7 Cities and 52 Restaurants. This new growth vector created positive brand association and connect with younger audience.
At Dunkin' Donuts India (DDI), a new focus was brought on beverage and donuts, while food continued to be a strong play. The focused strategy of enhancing core offerings, driving efficiencies along with shutdown of unprofitable stores led to significant reduction in DDI losses. DDI has also experimented with smaller Restaurant size. As an innovation, DDI launched Value range of donuts and signature donuts including Chocotella, White Choco Cheesecake, Choco Symphony and Coffee Toffee. Shaken Iced Coffee, Caramel Hazelnut Latte and Tiramisu Latte were among the new beverages launched during the year. On the food side, Toasties (Chilli Cheese and Chicken) and Big Joy Mayo Burger were added to the menu. DDI drove Value for Money by introducing a range of donuts at Rs 49 and also introduced a Donut+Coffee combo at Rs 89 with the objective of seeding the Donuts + Coffee habit. DDI was cautious in its expansion strategy aligned to the company's overarching strategy of profitable growth. Five new Restaurants were opened in FY 2018 while 31 Restaurants were decommissioned. The total number of DDI Restaurants stood at 37 as on March 31, 2018 as against 63 as on March 31, 2017.
In the fourth quarter of FY 2018, the Company commissioned its state-of-the-art facility in Greater Noida, a prestigious accomplishment for the Company that will give a better overall efficiency at the commissary level as well. It is the largest facility in the entire Domino's Pizza worldwide, as on date of report. The first to be fully owned and operated by Jubilant FoodWorks (JFL), the Greater Noida facility will be supplying food and non-food ingredients. It has the capacity to supply to around 550 DPI and 100 DDI Restaurants, reducing the need for outsourcing. This highly automated facility will make greater cost and quality control possible.
During the year ended 31 March 2018, the company's wholly owned subsidiary Jubilant FoodWorks Lanka (Private) Limited (JFLPL) launched one new Domino's Pizza Restaurant, taking its total Restaurant count to 24 (twenty four) as on March 31, 2018. In line with DPI, Every Day Value proposition was also rolled out for Sri Lanka business. New pizzas and sides were introduced in the menu to fuel excitement among the consumers.
During the year ended 31 March 2018, Jubilant FoodWorks announced joint venture with Golden Harvest QSR Ltd. (Golden Harvest), part of Golden Harvest group of Bangladesh to launch Domino's Pizza Restaurants in Bangladesh. For the purpose of this joint venture, a private limited company, Jubilant Golden Harvest Limited (JGHL) was incorporated. Jubilant FoodWorks will be the majority shareholder with 51% of the total shareholding, while Golden Harvest will hold the balance 49% in the joint venture company.
As on 31 March 2018, JFL had 1,134 Domino's Pizza Restaurants across 266 cities and 37 Dunkin' Donuts Restaurants across 10 cities. JFL has 11 Commissaries/Supply Chain Centres (SCCs) at strategic locations around India. These serve as manufacturing and distribution facilities for DPI and DDI, thus enabling the company to achieve economies of scale.
The Board of Directors of Jubilant FoodWorks at its meeting held on 08 May 2018, recommended issue of bonus shares in the proportion of 1 equity share of Rs 10/- each fully paid up for every 1 equity share of Rs 10/- each fully paid up as on the record date fixed for this purpose. The company has allotted 65,984,520 bonus shares on 26 June 2018 to the shareholders.
During the FY2019,the company opened 102 new restaurants Domino's Pizza and that took the total of 1227 Domino's Pizza Restaurants across 273 cities and and 31 Dunkin' Donuts Restaurants across 10 cities.in India.
During the year 2018-19,the company has further invested an amount of Rs 992.03 lakhs in its whollyowned subsidiary Jubilant FoodWorks Lanka Pvt Ltd.Further the company has invested an amount of Rs 456.58 lakhs representing 51% stake in joint venture Jubilant Golden Harvest Ltd.
As on 31 March 2020, Domino's Pizza India has a network of 1,335 restaurants across 282 cities. JFL also has exclusive rights for developing and operating Dunkin' Donuts restaurants in India, with 34 restaurants under the brand across 10 cities.The company also have 4 Hong's Kitchen.
The Company has an investment of Rs 9,690.11 lakhs (Previous year Rs 9,209.09 lakhs) (includes investment made during the FY2020 Rs 481.02 lakhs) in it wholly owned subsidiary Company Jubilant FoodWorks Lanka (Private) Limited as on 31 March 2020 to cater to the geographical market of Sri Lanka. Further, during the current year the Company has invested Rs 985.56 lakhs (Previous year Rs 456.58 lakhs) and as at 31 March 2020 the Company has an investment of Rs 1,442.14 lakhs (Previous year Rs 456.58 lakhs) in Jubilant Golden Harvest Ltd to cater to the geographical market of Bangladesh.
The company opened 134 new Domino's Pizza restaurants in FY 2021, surpassing the initial plan of opening 100. Also unveiled 7 new restaurants in our international markets, 5 in Sri Lanka and 2 in Bangladesh.As on 31 March 2021,the Company has 1,360 Domino's Pizza Restaurants, 24 Dunkin' Donuts Restaurants, 8 Hong's Kitchen and 4 Ekdum! Restaurants.
The Company has an invesment of Rs 9,978.13 lakhs (Previous Year Rs 9,690.11 lakhs) (includes investment made during the FY2021 Rs 288.02 lakhs) in its wholly owned subsidiary Company Jubilant FoodWorks Lanka (Private) Limited as on 31 March 2021 to cater to the geographical market of Srilanka.
During the year 2019-20, the Company has entered into an exclusive Master Franchise and Development Agreement with PLK APAC Pte. Ltd., a subsidiary of Restaurant Brands International Inc., to develop, establish, own and operate, and to license Franchisees to develop, establish, own and operate, Popeyesr Restaurants in India, Bangladesh , Nepal and Bhutan.
During the financial year 2019-20,Jubilant Foodworks Netherlands B.V. (JFN') was incorporated as a wholly-owned subsidiary of the Company in Netherlands.The Company acquired Fides Food Systems Cobperatief U.A. at a consideration of equivalent Rs 25,280.09 lakhs paid through its wholly owned subsidiary Jubilant Foodworks Netherlands B.V. in the Netherlands. Fides Food Systems Cobperatief U.A. holds 32.81 % equity shares in DP Eurasia N.V. ('DP Eurasia'). DP Eurasia is a public company listed with London Stock Exchange PLC, and is the exclusive master franchisee of the Domino's Pizza brand in Turkey, Russia, Azerbaijan and Georgia.
During the financial year 2022-23, the Company acquired 49% equity stake in Jubilant FoodWorks Bangladesh Limited and after acquisition, Jubilant Bangladesh became wholly owned subsidiary of the Company effective May 10, 2022. Resulting to this, the name of the Company was changed from Jubilant Golden Harvest Limited to Jubilant FoodWorks Bangladesh Limited with effect from July 7, 2022.
Jubilant FoodWorks International Investments Limited was incorporated as a wholly owned subsidiary of the Company in India on August 8, 2022. Hashtag g Loyalty Private Limited became an associate company on acquisition of 35% stake (on fully diluted basis) w.e.f. March 31, 2022. Further, Hashtag got into a Securities Subscription Agreement with new investor, who had acquired 15% stake in Hashtag, and accordingly, the Company's stake in Hashtag reduced from 35% to 29.75%.
Wellversed became an associate company on acquisition of 25.02% stake (on fully diluted basis) on May 2, 2022. The Company acquired 40% stake in Roadcast Tech Solutions Private Limited and Roadcast was made an associate Company effective September 29, 2022.
The Company added 13 stores taking the network tally to 48 stores in March 2023. During the year 2023, the Company introduced an all new Domino's Pizza Mania range comprising of four pizzas with two new sauces - Desi Makhani and Videshi(Hot and sweet). It stepped up network expansion in Bangladesh and grew the network from 9 stores at end of FY'22 to 17 stores by end of FY'23.
Jubilant Foodworks Ltd
Directors Reports
Dear Members,
Your Directors have pleasure in presenting the Twenty-Eight (28th)
Integrated Annual Report together with the Audited Standalone and Consolidated Financial
Statements for the financial year ended March 31, 2023 ('FY 2023').
FINANCIAL HIGHLIGHTS
A summary of the Company's financial performance in FY 2023 is as
follows:
| Particulars |
Standalone |
Consolidated |
|
FY 2023 |
FY 2022* |
FY 2023 |
FY 2022 |
| Revenue from Operations |
50,959.92 |
43,310.99 |
51,582.47 |
43,961.22 |
| Add: Other Income |
497.11 |
406.62 |
504.12 |
413.54 |
| Total Income |
51,457.03 |
43,717.61 |
52,086.59 |
44,374.76 |
| Profit before Depreciation & Amortisation, Finance |
|
|
|
|
| Cost, Exceptional items, Tax Expense & Other Income |
|
|
|
|
| (EBITDA) |
11,592.05 |
11,045.93 |
11,515.52 |
11,087.76 |
| Profit before Depreciation & Amortisation, Finance Cost, |
|
|
|
|
| Exceptional items & Tax Expense |
12,089.16 |
11,452.55 |
12,019.64 |
11,501.30 |
| Less: Finance Cost |
1,951.26 |
1,730.13 |
2,012.26 |
1,760.89 |
| Less: Depreciation & Amortisation Expense |
4,753.19 |
3,829.74 |
4,858.85 |
3,930.52 |
| Profit before share of net profit/ (loss) of associate,
exceptional items and tax |
5,384.71 |
5,892.68 |
5,148.53 |
5,809.89 |
| Share of net profit/ (loss) of associate |
|
|
(261.22) |
(104.03) |
| Profit before Exceptional items & Tax Expense |
5,384.71 |
5,892.68 |
4,887.31 |
5,705.86 |
| Less: Exceptional items |
466.39 |
73.25 |
|
73.25 |
| Profit before Tax Expense |
4,918.32 |
5,819.43 |
4,887.31 |
5,632.61 |
| Less: Taxation Expense |
1,356.20 |
1,444.33 |
1,356.97 |
1,451.72 |
| Profit for the year |
3,562.12 |
4,375.10 |
3,530.34 |
4,180.89 |
| Other Comprehensive Income/ (Loss) |
(2,043.24) |
2,430.02 |
(1,690.99) |
2,112.10 |
| Total Comprehensive Income for the year |
1,518.88 |
6,805.12 |
1,839.35 |
6,292.99 |
| Retained Earnings |
|
|
|
|
| Balance at the beginning of FY |
16,087.53 |
12,379.13 |
15,321.39 |
11,908.06 |
| Add: Profit for the FY |
3,562.12 |
4,375.10 |
3,532.01 |
4,203.92 |
| Add: Opening balance of ESOP Trust |
|
123.89 |
|
|
| Add: Exercise/ Lapse of share options |
83.41 |
23.14 |
83.41 |
23.14 |
| Less: Exercise/ Sale of shares held by ESOP Trust (Net |
|
|
|
|
| of Tax) |
(100.05) |
(23.57) |
(100.05) |
(23.57) |
| Less: Dividend paid on Equity Shares |
(791.81) |
(791.81) |
(791.81) |
(791.81) |
| Less: Acquisition of non controlling interest |
|
|
(240.86) |
|
| Add: Dividend on shares held by ESOP Trust |
1.62 |
1.65 |
1.62 |
1.65 |
| Balance at the end of FY |
18,842.82 |
16,087.53 |
17,805.71 |
15,321.39 |
*Also refer Note 51 to the standalone financial statements forming an
integral part of this Integrated Annual Report.
RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS
The Company delivered healthy revenue growth and strong profitability
amidst significant inflationary headwinds, while accelerating its network expansion.
During the year, the Company has added 240 stores (net), ending the year with 1,863 stores
across all brands in India. The Company had 1,816 Domino's, 13 Popeyes, 21
Dunkin' and 13 Hong's Kitchen stores as on March 31, 2023.
The total income on a standalone basis for FY 2023 reached to H
50,959.92 million which is higher by 17.7% compared to last year. The EBITDA of H
11,592.05 million increased by 4.9%. The EBITDA margin at 22.7%, decreased by 276 bps and
the net profit margin at 7.0% is lower by 308 bps when compared to last year. During FY
2023, the Company has not transferred any amount to the general reserve and entire amount
of profit for the year forms part of the ‘Retained Earnings'.
The operating context and the performance highlights has been
comprehensively discussed in Management Discussion and Analysis Report forming an integral
part of this Integrated Annual Report.
SHARE CAPITAL
As on March 31, 2023, the paid-up and subscribed share capital of the
Company stood at H 1,319,690,400/- divided into 659,845,200 equity shares of H 2/- each.
Your Board of Directors approved split/sub-division of equity shares of
the Company on February 2, 2022 and the same was approved by the shareholders by
resolution passed by way of postal ballot on March 27, 2022, such that each equity share
having face value of H 10/- (Rupees Ten only) fully paid-up, was sub-divided into five (5)
equity shares having face value of H 2/- (Rupees Two only) each, fully paid-up with
effect from April 20, 2022 (Record Date). Accordingly, the authorised share capital of the
Company was altered as H 1,500,000,000/- divided into 750,000,000 equity shares of H 2/-
each and the paid-up and subscribed share capital of the Company was altered as H
1,319,690,400/- divided into 659,845,200 equity shares of H 2/- each.
DIVIDEND
Based on the Company's performance and Dividend Distribution
Policy of the Company, your Directors are pleased to recommend Dividend of H 1.20/- (i.e.
60%) per equity share of H 2/- each fully paid up for FY 2023 amounting to H 791.81
million. The payment of dividend is subject to approval of the shareholders at the
forthcoming Annual General Meeting (‘AGM') of the Company and shall be subject
to deduction of tax at source.
EMPLOYEES STOCK OPTION SCHEMES
With a view to attract, reward and retain talented and key employees in
the competitive environment and encourage them to align individual performance with
Company objectives, the Company grants share based benefits to eligible employees under
the ESOP Schemes. The Company has two Employees Stock Option Schemes namely, JFL Employees
Stock Option Scheme, 2011 ('ESOP 2011') and JFL Employees Stock Option Scheme,
2016 ('ESOP 2016') (collectively referred as ‘ESOP Schemes'). Both the
schemes are administered through JFL Employees Welfare Trust ('ESOP Trust').
Consequent to split/sub-division of equity shares of the Company with effect from April
20, 2022 (Record Date), appropriate adjustments were made in the number of stock options
that have been granted under the ESOP Schemes and yet to be exercised (whether vested or
unvested but not lapsed) such that each such stock options shall be sub-divided into Five
(5) stock options of the same category and the respective exercise price for each such
stock option shall be one fifth (1/5) of the exercise price fixed at the time of grant of
such options. Also, the ceiling(s) on the maximum number of options/shares that may be
issued pursuant to exercise of options granted to the participants under the ESOP Schemes
shall stand proportionately increased. The details of both the schemes have also been
disclosed in Note 32 to the Standalone Financial Statements and Note 31 to the
Consolidated Financial Statements forming an integral part of this Integrated Annual
Report.
The Company has Jubilant FoodWorks General Employee Benefits Scheme,
2020 (‘JFGEBS') which was approved with the objective of providing healthcare
(including preventive measures), hospital care, or benefits in the event of sickness,
accident, disability, death or scholarship funds, rewards and recognitions, education,
employee engagement, training for skill enhancement/ development and such other welfare
activities and benefits specified by the Company. The JFGEBS would be implemented and
administered by the ESOP Trust. JFGEBS does not involve issue of shares by the Company for
the purposes of JFGEBS and also does not involve any secondary acquisition by the ESOP
Trust.
ESOP Schemes and JFGEBS are in compliance with the SEBI (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021, as amended (the ‘SEBI ESOP
Regulations 2021'). The details of ESOP Schemes and JFGEBS pursuant to SEBI ESOP
Regulations, 2021 as at March 31, 2023 is uploaded on the website of the Company (web
link: https://www.jubilantfoodworks.com/ company-reports/esop-disclosures). In terms of
Regulation 13 of SEBI ESOP Regulations 2021, the Certificate from Chandrasekaran
Associates, Company Secretaries, Secretarial Auditors, would be placed before the
shareholders at the ensuing AGM.
SUBSIDIARIES AND ASSOCIATE COMPANIES
Subsidiaries
Jubilant FoodWorks Bangladesh Limited (‘Jubilant
Bangladesh'):
Jubilant Bangladesh is a subsidiary of the Company in Bangladesh.
Jubilant Bangladesh has exclusive rights to develop and operate Domino's stores in
Bangladesh.
During the financial year, the Company has completed 100% acquisition
of Jubilant Bangladesh by exercising the call options for acquiring additional 49% equity
stake in Jubilant Bangladesh from Golden Harvest QSR Limited (‘Golden Harvest')
at a consideration amounting to BDT 389.02 million (equivalent to H 340.25 million).
Consequent to completion of acquisition on May 10, 2022, Jubilant Bangladesh became wholly
owned subsidiary of the Company (with 1 share of Jubilant Bangladesh being held by a
nominee of the Company in order to comply with local law requirements in Bangladesh).
The name of the company was changed from Jubilant Golden Harvest
Limited to Jubilant FoodWorks Bangladesh Limited with effect from July 7, 2022.
During the financial year, Jubilant Bangladesh launched ever-highest
number of stores in a financial year. 8 new stores were launched taking the total count to
17 stores. The performance of Jubilant Bangladesh continues to remain encouraging. A
series of intervention on menu expansion, packaging innovation and launch of "Live
Pizza Theatre" - live-streaming of pizza preparation, helped enhance consumer
engagement. The system sales growth of 46.8% was on the back of Dine-in and Takeaway
growth. The total income of Jubilant Bangladesh grew by 38.30% as on March 31, 2023 and is
H 347.76 million as compared to H 251.45 million in the previous year.
Jubilant FoodWorks Lanka (Private) Limited (‘Jubilant Sri
Lanka'):
Jubilant Sri Lanka is a wholly owned subsidiary of the Company in Sri
Lanka. Jubilant Sri Lanka has exclusive rights to develop and operate Domino's stores
in Sri Lanka.
The pace of store expansion increased with the launch of 13 stores
taking the total count to 48. Despite economic challenges during the financial year, the
system sales grew by 35.7% led by growth in dine-in and takeaway channel. Focused efforts
through various initiatives like rationalizing discounts, reducing wastages, targeted
marketing activities and digital ordering interventions ensured business continuity. The
total income reduced by 17.33% and is H 417.60 million as on March 31, 2023 compared to H
505.15 million in the previous year.
Jubilant Foodworks Netherlands B.V. (‘Jubilant Netherlands')
and DP Eurasia N.V. (‘DPEU'):
Jubilant Netherlands is a wholly owned subsidiary of the Company in
Netherlands. During the financial year, Jubilant Netherlands has increased its stake in
DPEU through various on-market purchases. The Company through Jubilant Netherlands
is holding 71,413,939 ordinary shares in DPEU representing 49.04% of its issued share
capital as on March 31, 2023. DPEU is a public company listed with London Stock Exchange
PLC, and is the exclusive master franchisee of the Domino's Pizza brand in Turkey,
Russia, Azerbaijan and Georgia. The total income of Jubilant Netherlands is nil as on
March 31, 2023 (H 0.54 million in the previous year).
Jubilant FoodWorks International Investments Limited (‘Jubilant
International'):
Jubilant FoodWorks International Investments Limited was incorporated
as a wholly owned subsidiary of the Company in India on August 8, 2022. Jubilant
International is an Investment Company with an objective of making investments in
associates/ subsidiaries engaged in food service business. The total income of Jubilant
International is H 1.55 million as on March 31, 2023.
Jubilant FoodWorks International Luxembourg (‘Jubilant
Luxembourg'):
The Company along with Jubilant FoodWorks International Investments
Limited (wholly owned subsidiary) has incorporated a subsidiary Company i.e. Jubilant
FoodWorks International Luxembourg on September 21, 2022 in Luxembourg. Jubilant
Luxembourg has been incorporated with an objective of making investments in
associates/subsidiaries engaged in food service business. The total income of Jubilant
Luxembourg is nil as on March 31, 2023.
Associate Companies
With an intent of making strategic investments in promising start-ups
and emerging businesses and in line with its stated goal of building a multi-brand and
multi-country food business powered by technology, the Company has made following
acquisition(s):
a) Hashtag Loyalty Private Limited (‘Hashtag'):
Hashtag became an associate company on acquisition of 35% stake (on
fully diluted basis) w.e.f. March 31, 2022.
Further, Hashtag entered into a Securities Subscription Agreement dated
April 17, 2023 with a new investor pursuant to which the new investor has acquired 15%
stake (on a fully diluted basis) in Hashtag. Accordingly, the Company's stake in Hashtag
has reduced from 35% to 29.75% (on a fully diluted basis).
Hashtag is engaged in the business of providing a platform which allows
brands their own online ordering systems to accept direct orders from customers and
provides an enterprise-grade omnichannel customer engagement & marketing automation
platform. The total income grew by 12.69% and is H 25.39 million as on March 31, 2023
compared to H 22.53 million in the previous year.
b) Wellversed Health Private Limited (‘Wellversed'):
Wellversed became an associate company on acquisition of 25.02% stake
(on fully diluted basis) on May 2, 2022.
Wellversed is a nutrition company offering a variety of food products
tailored for specific nutrition and dietary needs including keto, gluten-free, vegan,
high-protein, diabetic and immunity. The total income grew by 183.61% and is H
347.14 million as on March 31, 2023 compared to H 122.40 million in the previous
year.
c) Roadcast Tech Solutions Private Limited (‘Roadcast'):
The Company entered into Share Subscription Agreement,
Shareholders' Agreement and Share Purchase Agreement dated July 28, 2022 to invest
approx. H 149.8 million for acquisition of 40% stake (on fully diluted basis) in Roadcast.
The aforesaid acquisition was completed on September 29, 2022 and Roadcast became an
associate company.
Roadcast is engaged in the business which offers a logistics platform
for management of last-mile delivery operations. Roadcast's delivery automation SaaS
platform helps clients to monitor their fleet and personnel in real-time, providing a
platform which allows brands their own online ordering systems to accept direct orders
from customers and provides an enterprise-grade omnichannel customer engagement &
marketing automation platform.
The total income grew by 122.94% and is H 257.25 million as on March
31, 2023 compared to H 115.39 million in the previous year.
A report on the performance and the Financial position of the
subsidiaries, associate companies and ESOP Trust, as per Companies Act, 2013 and Rules
made thereunder (the 'Act') is provided in Form AOC-1 attached to the
Consolidated Financial Statements forming an integral part of this Integrated Annual
Report. Pursuant to the provisions of Section 136 of the Act, separate audited accounts of
the subsidiaries, are available on the website of the Company (web link: https://
www.jubilantfoodworks.com/company-reports/financial-of-subsidiary-companies).
Apart from above, no other company has become or ceased to be
subsidiary, joint venture or associate of the Company during the financial year.
ANNUAL RETURN
As per Section 134(3)(a) of the Act, the Annual Return referred to in
Section 92(3) of Act for the financial year ended on March 31, 2023 is available on the
website of the Company (web link: https://www.jubilantfoodworks.com/company-reports/
annual-returns).
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In terms of Articles of Association of the Company and provisions of
the Act, Mr. Shamit Bhartia (DIN: 00020623) and Ms. Aashti Bhartia (DIN: 02840983)
Directors of the Company, are liable to retire by rotation at the ensuing AGM and being
eligible, offered themselves for re-appointment. The Board of Directors recommend their
re-appointment for consideration by the shareholders of the Company at the ensuing AGM.
Mr. Pratik R. Pota resigned as CEO & Wholetime Director of the
Company with effect from close of business hours of June 15, 2022. The Board placed on
record its sincere appreciation for the outstanding contribution made by Mr. Pota during
his tenure with the Company.
The shareholders of the Company in their 27th AGM held on
August 30, 2022 approved:
a) Appointment of Mr. Sameer Khetarpal as Chief Executive Officer &
Managing Director of the Company for a period of five years with effect from September 05,
2022 upto September 04, 2027; b) Re-appointment of Mr. Ashwani Windlass (DIN:
00042686) as an Independent Director of the Company for a second term of five consecutive
years with effect from July 25, 2023 to July 24, 2028; c) Re-appointment of Mr. Abhay P.
Havaldar (DIN: 00118280) as Independent Director of the Company for a second term
of five consecutive years with effect from July 25, 2023 to July 24, 2028.
The shareholders of the Company in their 24th AGM appointed
Mr. Vikram S. Mehta (DIN: 00041197) and Ms. Deepa M. Harris (DIN: 00064912) as Independent
Directors of the Company for a term from February 1, 2019 to January 31, 2024 and from
June 21, 2019 to June 20, 2024, respectively.
Considering the vast experience, expertise, acumen, positive
attributes, integrity and significant contribution made by both the Directors and
recommendations of the Nomination, Remuneration and Compensation Committee, the Board
(subject to the approval of the shareholders) in their meeting held on May 17, 2023
approved:
a) Re-appointment of Mr. Vikram S. Mehta as an Independent Director of
the Company for a second term of five consecutive years with effect from February 1, 2024
upto January 31, 2029;
b) Re-appointment of Ms. Deepa M. Harris as an Independent Director of
the Company for a second term of five consecutive years with effect from June 21, 2024
upto June 20, 2029.
Further, on the recommendations of the Nomination, Remuneration and
Compensation Committee, the Board in their meeting held on May 17, 2023 approved
appointment of Mr. Amit Jain (DIN: 01770475) as an Additional Director designated
as an Independent Director with effect from July 1, 2023. The term of his appointment as
an Independent Director will be for a period of five (5) years, subject to the approval of
the shareholders of the Company in the general meeting.
In the opinion of the Board, Mr. Mehta, Ms. Harris and Mr. Jain
fulfils the conditions specified in the Act and under SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'). The Company
has received notices under Section 160 of the Act proposing appointment/ re-appointment
of above-mentioned Directors of the Company.
The Board of Directors recommend their appointment/ re-appointment for
consideration by the shareholders of the Company at the ensuing AGM.
Except as stated above, there was no change in the Directors or Key
Managerial Personnel of the Company, during the year under review.
In terms of Rule 8(5) (iiia) of the Companies (Accounts) Rules, 2014,
in the opinion of the Board, all appointments/ re-appointments of Independent
Directors during the financial year were made after due veracity of their integrity,
expertise, experience and proficiency.
Brief profile, nature of expertise, details of directorship held in
other companies, Chairmanships/ membership of Board Committees , shareholding in the
Company held by the Directors and relationship with Directors inter-se and other
details as stipulated under Regulation 36(3) of the Listing Regulations, as amended read
with the provisions of the Secretarial Standard on General Meetings issued by the
Institute of Company Secretaries of India (‘SS-2') relating to the Directors
proposed to be appointed/ reappointed at the 28th AGM is annexed to the notice
convening the 28th AGM.
Declaration by Independent Directors
All the Independent Directors of the Company have given their
declarations to the Company under Section 149(7) of the Act that they meet the criteria of
independence as provided under Section 149(6) of the Act read with Regulation 16(1)(b) of
the Listing Regulations and are not disqualified from continuing as Independent Directors
and that they have registered themselves as an Independent Director in the data bank
maintained with the Indian Institute of Corporate Affairs. Based on the disclosures
received, the Board is of the opinion that, all the Independent Directors fulfill the
conditions specified in the Act and Listing Regulations and are independent of the
management.
MEETINGS OF BOARD OF DIRECTORS
Four (4) Meetings of Board of Directors were held during FY 2023. The
details of the meetings of the Board and its Committees are given in the Corporate
Governance Report forming an integral part of this Board's Report.
APPOINTMENT & REMUNERATION POLICY
The Company has an ‘Appointment & Remuneration Policy'
for Directors, Key Managerial Personnel and Senior Management/ other employees of the
Company, specifying criteria for determining qualifications, positive attributes,
independence of a director and other matters which is disclosed on the website of the
Company (web link: https://www.jubilantfoodworks.com/
investors/governance/policies-codes). The salient features of the Policy have been
disclosed in the Corporate Governance Report forming an integral part of this Board's
Report.
PERFORMANCE EVALUATION OF THE BOARD
The Board adopted a formal mechanism for evaluating its performance and
as well as of its Committees and individual Directors, including the Chairperson of the
Board. The detailed process in which annual evaluation of the performance of the Board,
its Chairperson, its Committees and of individual Directors has been made is disclosed in
the Corporate Governance Report forming an integral part of this Board's Report.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY MANAGERIAL PERSONNEL
The details of Employees, Directors & Key Managerial Personnel as
required under Section 197 of the Act read with the Companies (Appointment and
Remuneration) Rules, 2014 is annexed herewith as Annexure ‘A' forming an
integral part of this Board's Report.
LOANS, GUARANTEES AND INVESTMENTS
Particulars of guarantee and investments made have been disclosed in
Note 31 and 4 to the Standalone Financial Statements, respectively, forming an integral
part of the Integrated Annual Report. During FY 2023, the Company has not given any loan
pursuant to Section 186 of the Act.
RELATED PARTY TRANSACTIONS
All contracts, arrangements and transactions entered by the Company
during FY 2023 with related parties were in the ordinary course of business and on arm's
length basis and were approved by the Audit Committee. The Board of Directors of the
Company had laid down the criteria for granting the omnibus approval by the Audit
Committee for the transactions which are repetitive in nature, in line with the
Company's Policy on Materiality of and dealing with Related Party Transactions
(‘RPT Policy'). During the year, the Company had not entered into any materially
significant transaction as defined in the RPT Policy with related parties viz. promoters,
directors, their relatives or the management, subsidiaries etc. that may have potential
conflict with the interests of the Company at large. Accordingly, the disclosure of
Related Party Transactions under Section 188(1) of the Act in Form AOC-2 is not
applicable. Related Party disclosures including transactions with promoter/promoter group
which hold(s) more than 10% shareholding in the Company have been disclosed in Note 33 to
the Standalone Financial Statements forming an integral part of this Integrated Annual
Report. The RPT Policy was modified by the Board with effect from April 1, 2022 to align
the same with the statutory changes. The RPT Policy is disclosed on the Company's
website (web link: https://www.jubilantfoodworks.
com/investors/governance/policies-codes).
AUDITORS
Statutory Auditor
Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn. No.
117366W/W-100018) (‘Deloitte'), were re-appointed as Statutory Auditors of the
Company by the Shareholders in their 27th AGM held on August 30, 2022, for a
second term of five consecutive years i.e. from the conclusion of 27th AGM
until the conclusion of 32nd AGM of the Company to be held in the year 2027.
The Auditors' Report read together with Annexures referred to in the Auditors'
Report for the financial year ended March 31, 2023 does not contain any qualification,
reservation, adverse remark or disclaimer. During the year under review, the Statutory
Auditor has not reported any matter of fraud under Section 143 (12) of the Act, therefore
no disclosure is required under Section 134(3)(ca) of the Act.
Secretarial Auditor
The Board appointed Chandrasekaran Associates, Company Secretaries to
conduct Secretarial Audit pursuant to the provisions of Section 204 of the Act for FY
2023. The Secretarial Audit Report for the financial year ended March 31, 2023 received
from Secretarial Auditor is annexed herewith as Annexure ‘B' forming an
integral part of this Board's Report. The Secretarial Audit Report does not contain
any qualification, reservation, adverse remark or disclaimer. During the year under
review, the Secretarial Auditor has not reported any matter of fraud under Section 143
(12) of the Act, therefore no disclosure is required under Section 134(3) (ca) of the Act.
AUDIT COMMITTEE
The Audit Committee comprises of Mr. Ashwani Windlass as Chairman, Mr.
Abhay P. Havaldar, Ms. Deepa M. Harris, Mr. Shamit Bhartia and Mr. Vikram S. Mehta as
members. Brief terms of reference, meetings and attendance are included in the Corporate
Governance Report forming an integral part of this Board's Report. All the
recommendations made by the Audit Committee were accepted by the Board of Directors of the
Company.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has in place Whistle Blower Policy and has established the
necessary vigil mechanism for directors and employees in confirmation with Section 177(9)
of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical
behavior and also provides for direct access to the Chairman of the Audit Committee in
exceptional cases. The details of vigil mechanism as provided in the Whistle Blower Policy
has been disclosed in the Corporate Governance Report forming an integral part of this
Board's Report. The Whistle Blower Policy is disclosed on the Company's website
(web link: https://www.jubilantfoodworks. com/investors/governance/policies-codes).
RISK MANAGEMENT
Risk Management is an integral and important component of Corporate
Governance. The Board of Directors of the Company has constituted Risk Management
Committee ('RMC') which assists the Board in monitoring and reviewing the risk
management plan, implementation of the risk management framework of the Company and such
other functions as Board may deem fit. The Board updated the Risk Management Policy with
effect from May 17, 2023 to bring more objectivity in risk classification &
prioritization. The Risk Management framework is in place to identify, prioritize,
mitigate, monitor and appropriately report any significant threat to the
organization's strategic objectives, its reputation, operational continuity,
environment, compliance, and the health & safety of its employees. A detailed section
on Risk Management is provided in the Management Discussion and Analysis Report forming an
integral part of this Integrated Annual Report.
INTERNAL FINANCIAL CONTROL
The Company has adequate internal financial controls systems in place,
which facilitates orderly and efficient conduct of its business including adherence to
Company's policies, safeguarding of its assets, prevention and detection of frauds
and errors, accuracy and completeness of the accounting records and timely preparation of
reliable financial information. The Company's internal control framework are
commensurate with the size and nature of its operations. Deloitte Haskins & Sells LLP,
Statutory Auditor have audited the financial statements of the Company included in this
Integrated Annual Report and have also confirmed the adequacy and operational
effectiveness of the Company's internal control over financial reporting (as defined
in Section 143 of the Act) as on March 31, 2023. A detailed section on Internal Controls
and their Adequacy is provided in the Management Discussion and Analysis Report forming an
integral part of this Integrated Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the Listing Regulations, Management
Discussion and Analysis Report for the financial year under review is presented in a
separate section, forming an integral part of this Integrated Annual Report.
CORPORATE SOCIAL RESPONSIBILITY
The Company has in place Corporate Social Responsibility Policy
(‘CSR Policy') which outlines the Company's philosophy and responsibility
and lays down the guidelines and mechanism for undertaking socially impactful programs
towards welfare and sustainable development of the community around the area of its
operations and other parts of the Country. The CSR Policy is disclosed on the
Company's website (web link: https://www.
jubilantfoodworks.com/investors/governance/policies-codes). In terms of Section 135 of the
Act read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014
as amended, the Annual Report on Corporate Social Responsibility Activities for FY 2023 is
annexed herewith as Annexure ‘C' forming an integral part of this
Board's Report.
CORPORATE GOVERNANCE
The Corporate Governance philosophy of the Company is driven by the
interest of stakeholders, focus on fairness, transparency and business needs of the
organisation. The Company continues to be compliant with the requirements of Corporate
Governance as stipulated in Listing Regulations. In terms of Regulation 27 of Listing
Regulations, the Corporate Governance Report including a certificate from Chandrasekaran
Associates, Company Secretaries, regarding compliance of the conditions of Corporate
Governance is annexed herewith as Annexure ‘D' forming an integral part
of this Board's Report. The Corporate Governance Report, inter-alia, contains
the following disclosures:
a) Composition of Committees including Audit Committee, Nomination,
Remuneration and Compensation Committee, Stakeholders Relationship Committee,
Sustainability & Corporate Social Responsibility Committee, Risk Management Committee,
Investment Committee and Regulatory and Finance Committee; b) Disclosure relating to
affirmation submitted by the Directors and Senior Management confirming compliance of the
Code of Conduct for Directors and Senior Management; c) Dividend Distribution Policy; d)
Details of Credit Rating; e) Details of Unpaid and Unclaimed Dividend Account and transfer
to Investor Education and Protection Fund; and
f) Details of remuneration of Directors including service contracts,
notice period, severance fees, stock options held by them.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
In terms of Regulation 34 of the Listing Regulations, Business
Responsibility and Sustainability Report for FY 2023 is annexed herewith as Annexure
‘E' forming an integral part of this Board's Report.
PREVENTION OF SEXUAL HARASSMENT
The Company is committed towards promoting the work environment that
ensures every employee is treated with dignity and respect and afforded equitable
treatment irrespective of their gender, race, social class, caste, creed, religion, place
of origin, sexual orientation, disability or economic status. Pursuant to the provisions
of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 (‘POSH Act'), the Company has adopted a Policy on prevention of Sexual
Harassment at Workplace. Periodic sessions were also conducted to apprise employees and
build awareness on the subject matter. Our key focus is to create a safe, respectful and
inclusive workplace which fosters professional growth for each employee.
As per the requirement of the POSH Act and Rules made thereunder, the
Company constituted an Internal Complaints Committee (ICC) to redress the complaints
received regarding sexual harassment. The ICC meets periodically to discuss various
scenarios/sample cases and steps that can be taken to ensure that POSH cases are reported
and addressed uniformly across the organization. The details of the complaints received
during the year under review are as follows. The Company endeavours to complete the
inquiry process within the stipulated period of 90 days. i. Complaints filed during the
financial year : 43 ii. Complaints disposed off during the financial year : 40 iii.
Complaints pending as on end of the financial year : 3
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
(A) Conservation of Energy
The Company continuously strives to reduce the environmental impact of
its operations and lower its carbon footprint. It focusses on improving energy efficiency,
increasing the use of renewable energy and improving waste management to reduce the
overall environment footprint.
i) The steps taken or impact on conservation of energy a) Energy
Management Systems (‘EMS'): EMS are installed across stores and commissaries to
reduce energy consumption. This year, the Company upgraded EMS for approximately 747
stores, which accounts for around 40% of the stores. Due to this the Company has been able
to achieve energy savings of around 5%.
b) Retrofitting old chiller: The project involved a detailed audit to
identify areas of improvement and to assess the design versus actual conditions. This
enabled a better understanding of the energy usage patterns and the identification of
areas where energy could be saved. The project with energy-efficient chiller has resulted
in significant cost savings of approximately 10 lakh Kwh and avoided, around 790 tCO2e
c) Replacing electric heating with heat pumps: Traditional electric
heaters were replaced with energy-efficient heat pumps, which are known for their high
energy efficiency and low operating costs. The implementation of heat pumps at tray washer
areas by replacing electric heaters has resulted in significant cost savings of around 3
lakh kwh and avoided around 237 tCO2e
d) Other energy efficiency initiatives: Some of the initiatives at
stores includes retrofitting energy efficient air conditioners, deploying energy efficient
ovens at new stores, and installing IoT devices at delivery bikes to monitor speed, time,
and delivery efficiency. In addition, converting LPG to PNG at stores wherever available
can lead to significant savings in emissions, reduced residual gas, and smoother
operations.
ii) The steps taken by the Company for utilising alternate sources of
energy a) Renewable energy: Solar Power Plants are already installed at commissaries
in Greater Noida, Nagpur, Mumbai, and Kolkata, accounting for approximately 11% of total
electricity consumption. This has also replaced 1,424 MWh of electricity generated by
fossil fuels and hence avoided 1,125 tCO2e of emissions.
b) E-Bikes: The Company has made significant progress this year,
increasing the number of e-bikes and e-cycle to 7,594 bringing the percentage of e-bikes
to 33%. This is an important initiative to reduce our carbon footprint and transition to a
more sustainable future. The company is focused to implement e-bikes in all of the new
stores, taking into account the local terrain. All of the bikes used in Popeyes and Hong's
Kitchen are already electric.
As a result of this initiative, approximately 1,313 kl of petrol is
saved and avoided around 3,523 tCO2e emissions.
iii) The capital investment on energy conservation equipment
Capital investment on energy conservation equipment during FY 2023 was
H 630.88 million approx.
(B) Technology Absorption
The Company believes in leveraging technology to transform every
dimension of its business.
The Technology Absorption has been discussed under ‘Data and
Technology Forward' section in Management Discussion and Analysis Report forming an
integral part of this Integrated Annual Report.
(C) Foreign Exchange Earnings & Outgo
| Particulars |
FY 2023 |
FY 2022 |
| Foreign Exchange earned in terms of actual inflows |
129.61 |
55.20 |
| (FOB Basis) |
|
|
| Foreign Exchange outgo in terms of actual outflows |
2,258.31 |
1,679.02 |
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that in the preparation of the Statement of Profit
and Loss Account for the financial year ended March 31, 2023 and the Balance Sheet as at
that date, the Directors have:
a) followed the applicable accounting standards along with proper
explanation relating to material departure; b) selected such accounting policies and
applied them consistently and made judgments and estimates that are reasonable and prudent
so as to give a true and fair view of the state of affairs of the Company at the end of
the financial year and of the profit of the Company for that period;
c) taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d) prepared the annual accounts on a going concern basis;
e) laid down internal financial controls to be followed by the Company
and that such internal financial controls are adequate and were operating effectively; and
f) devised proper systems to ensure compliance with the provisions of
all applicable laws and that such systems were adequate and operating effectively.
COMPLIANCE OF THE SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards on
Meetings of the Board of Directors and on General Meetings issued by the Institute of
Company Secretaries of India.
OTHER STATUTORY DISCLOSURES
During FY 2023, there were no transaction requiring disclosure or
reporting in respect of matters relating to:
a) Details relating to deposits covered under Chapter V of the Act. The
Company had no outstanding, unpaid or unclaimed public deposits during the FY 2023;
b) Maintenance of cost records under sub-section (1) of Section 148 of
the Act is not applicable to the Company;
c) Issue of equity shares with differential rights as to dividend,
voting or otherwise;
d) Issue of Sweat Equity shares;
e) Any remuneration or commission to the Wholetime Director/ Managing
Director of the Company from the subsidiaries of the Company; f) No significant and
material orders passed by the Regulators/ Courts/Tribunals which impact the going concern
status and Company's operations in future;
g) No change in the nature of the business of the Company;
h) No application made or any proceeding pending under the Insolvency
and Bankruptcy Code, 2016; and
i) No instance of any one-time settlement with any Banks or Financial
Institutions.
There have been no material changes and commitment, affecting the
financial position of the Company which occurred between the end of FY 2023 till the date
of this Report, other than those already mentioned in this Report.
ACKNOWLEDGEMENTS
Your Directors take this opportunity to thank and acknowledge with
gratitude, the contribution, co-operation and assistance received from International
Business Partners from Domino's, Popeyes, Dunkin', Government and Regulatory
Authorities, Business Partners, Bankers, Members and other Stakeholders. Also, the Board
places on record its deep appreciation for the enthusiasm, co-operation, hard work,
dedication and commitment of the employees at all levels.
Your Directors appreciate the continued co-operation and support
received from its customers that has enabled the Company to make every effort in
understanding their unique needs and deliver maximum customer satisfaction.
Inspired by the Vision, driven by Values and powered by Strength, your
Directors and employees of the Company look forward to the future with confidence and
stand committed to creating an even brighter future for all stakeholders.
For and on behalf of the Board of Directors
| Shyam S. Bhartia |
Hari S. Bhartia |
| Chairman & Director |
Co-Chairman & Director |
| DIN: 00010484 |
DIN: 00010499 |
| Place: Noida |
Place: Noida |
| Date: May 17, 2023 |
Date: May 17, 2023 |
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