Will Jubilant FoodWorks deliver on analysts' optimism?

Company has struggled to grow profitably in recent times, but analysts remain bullish

Jubilant FoodWorks stock surged as much as 7.6 per cent on Thursday after upgrade by Goldman Sachs to "buy" from "neutral" earlier. One-year target price for the stock has been raised 36 per cent to Rs 1,228 by the foreign brokerage. 

Analysts at other agencies also remain bullish. They believe Jubilant can overcome near-term demand hurdles and grow strong after that. Bloomberg consensus estimate sees the company's standalone net profit growing 18 per cent in FY18. The growth looks good, but sprouts from a low base.

Moreover, rising competition and slowing demand have weighed on Jubilant's financials for some time