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The company made these remarks to brokerage firm Goldman Sachs at its India Corporate Day event.
Westlife Foodworld expects three factors to drive growth in same store sales for the company.
Westlife launched the McCrispy platform in September this year, which is a campaign to promote the new McCrispy Chicken and Crispy veggie burgers.
The company also intends to strengthen its value offerings to drive same store sales going forward.
A low base will also contribute to the growth that Westlife anticipates seeing during the second half of the current financial year. The second half of the base quarter was impacted by a one-off.
Same store sales growth for Westlife stood at a negative 6.5% during the September quarter due to a subdued instore business, while the off-premise business saw stable same store sales.
Goldman Sachs wrote in its note that there has been a positive impact from menu interventions. It also said that the gross margin impact in the September quarter is temporary and that the operating leverage will start to playout as same store sales recover.
Goldman Sachs has a “buy” recommendation on Westlife Foodworld with a price target of ₹1,045, which is the highest on the street for the company. Goldman Sachs’ price target implies a potential upside of 31% for the stock.
Shares of Westlife Foodworld ended 0.3% higher on Thursday at ₹798. The stock is down 16% from its recent peak of ₹957. The stock has been an underperformer this year, down 2.6% so far.
