Risk factor
Strong & resilient to price shocks
Profitability factor
Greatly overvalued vs peers
About
Devyani International Limited (DIL) is a prominent operator of franchised quick-service dining establishments across India, Nepal, and Nigeria. Its business operations are segmented into three main areas: the Core Brands, which encompass KFC, Pizza Hut, and Costa Coffee outlets situated in India; the International Business segment, focusing on KFC and Pizza Hut locations in Nepal and Nigeria; and the Other Business division, which features its proprietary brands including Vaango, Food Street, Masala Twist, Ile Bar, Amreli, and Ckrussh Juice Bar. By March 31, 2022, DIL's extensive portfolio included 364 KFC outlets, 413 Pizza Hut locations, and 55 Costa Coffee shops. Additionally, its 'Other Business' segment managed 50 proprietary brand establishments. Established in 1991, the company maintains its headquarters in Gurugram, India, and functions as a subsidiary of RJ Corp Limited.
Company Valuation
Based on key historical and expected multiples, the stock is greatly overvalued relative to its peers. Specifically, the stock is 'expensive' on P/E, neutral on EV/EBITDA
Target Price
The average target price of DEVYANI.NS is 159 and suggests 28.4% upside potential. Usually, this means a BUY recommendation among investment firms, or a recommendation to