Earnings Call Transcript - XNSE:JUBLFOOD 2026-11-06

Operator

Ladies and gentlemen, good day and welcome to the Jubilant Foodworks Ltd. Q2-FY27 Earnings Conference Call. As a reminder, all participant clients will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Apar, Head of Investor Relations at Jubilant Foodworks. Thank you, and over to you, sir.

Apar, Head of Investor Relations

527 Earnings Call for Investors and Analysts. We are joined today by senior members of the management team, including our chairman, Mr. Shamus Bhartia, co-chairman, Mr. Hari S. Bhartia, our CEO and MD, Mr. Samir Khitarpal, and our CFO, Ms. Suman Higde. Please note that this earnings call is scheduled for a duration of 45 minutes, and we will commence directly with the Q&A session. Along with the Q2FI27 financial results, we have released a letter to our shareholders, in which we have shared our outlook, and I have already answered certain pertinent questions about the performance. Hence, the participants are requested to limit the scope of discussion to only strategy questions and the count of questions to only two. If you wish to seek any accounting clarification, kindly get in touch with the Investor Relations team later. A cautionary note before we move ahead. Some of the statements made on today's call would be forward-looking in nature, and the actual results may vary from such statements. I will now hand back the call to the moderator to begin the Q&A session. Thank you.

Operator

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

Operator

To ask questions, please press star and 1.

Operator

The first question is from Nihal Mahesh-Shaw from HSBC. Please go ahead.

Nihal Mahesh-Sham, Analyst — HSBC

Yes, hi, team. Good evening. My first question was that what is the quantum of price hike that you all take? And given that cheese is also infinitely sort of inflated, and while you've clarified about the way you sort of plan to mitigate it, is there sort of a requirement of further price hike that could be required?

Samir Khitarpal, CEO

So, Nihal, I think we are watching all cost line items very closely, and through a mix of pricing, discount management, and product mix, we are working on the gross margin lines. Not to say that we are not working on the lines below. So, we've taken about one... 40 or 150 to 200 basis point of price increases, very calibrated through machine learning models versus taking blunt price increases, where we can day parts, channels. So everything is on the table to make sure we mitigate the inflation. And if need be, we will, those experiments are always going. And if need be, we will take further price increases.

Suman Higde, CFO

Coming to cheese, specifically on dairy, Nihal, if I can address it. See, in the immediate years, dairy prices are seeing significant inflation coming through, and we've seen that in the milk prices that are coming across states. Now, the translation of milk price to cheese, there's a bit of a value chain timing impact that is there. Having said that, we were covered, I think we said this in our previous course, we are fairly covered for this financial year on our cheese supplies, but were dairy or any of the other commodities, we're seeing similar kind of inflation coming across, not only in dairy, but even on chicken and on other vegetables coming across because of the monsoons also, which have hit apart from just the other factors of the West. And we'll take pricing accordingly, as Sameed said, in a calibrated manner to mitigate it and manage our gross margins effectively. So, that's the plan, and that's what we've been doing over the last two quarters as well.

Nihal Mahesh-Sham, Analyst — HSBC

Got that. Thanks, Umun. The second question was that when we spoke last, obviously, you said on the LFL part that, you know, to look at it on a two-year cumulative basis. And just to understand, so as we look into the second half, fair to say that from a two-year cumulative perspective, you should reach that 5% to 7% range, or that 5% to 7% is, for the full year, is it just your comments on the LFL trajectory?

Samir Khitarpal, CEO

I think we've planned it to have a full year in the 5% to 7% range, and therefore, if you see from Q4 to Q1 to Q2, you see an uptick, and we have planned Q3 to be in that range.

Nihal Mahesh-Sham, Analyst — HSBC

I have a few more questions. I'll just come back. Thanks.

Samir Khitarpal, CEO

Why don't you continue, Nihal? It's okay. Why don't you ask the question?

Nihal Mahesh-Sham, Analyst — HSBC

So just one final question was that, you know, I was looking at, you give cumulative data on the monthly active users and transacting users. I know it has Popeyes and Domino's and Holmes combined in it. But it's just interesting to see that while the MAU is growing at 25%, the MTU is sort of seen only a 9% growth. And I'm guessing a lot of our spends in terms of also getting customers sometimes on the app would be in terms of MAU. So what explains the divergence where people are sort of going, opening the app, but maybe the orders are sort of, you know, not happening at the rate at which people are opening the app or such?

Samir Khitarpal, CEO

Yeah, no, I think, sir, we like the getting, I mean, just zoom out for one minute in terms of MTUs, right? The numbers for aggregators, for us combined is minuscule, right? So we are talking about 15, 20, 25 million MTUs, right? In a country so large, right? Which means Online delivery is under-penetrated, pizza is under-penetrated, and QSR is under-penetrated. So first is we have to get more customers. And for context, India would do roughly 5 to 6 million deliveries in a day. China will do 90 million deliveries in a day. Right. So that will come from new customers. And therefore, we have tweaked our marketing, digital marketing assets to acquire more customers. So we feel very good about the new customer acquisition rate. Of course, when new customers come in, these new customers are buying into categories or buying into delivery for the first time or they be new to Domino's. The conversion will be lower, but we are not seeing drop in the long term value of customers. So, I do not worry too much about it. As long as we are getting the customers, we are gaining market share, our AC Nielsen reports that we get, we are increasing market share, and we are growing. Those are more important pieces.

Nihal Mahesh-Sham, Analyst — HSBC

Got that. Thanks, Samir and Dean. Vishal, I'm very happy to have you. Thank you.

Suman Higde, CFO

Thank you.

Operator

Thank you.

Operator

Participants who wish to ask questions may press star and 1 to join the question queue. Ladies and gentlemen, to ask a question, you may press star and 1.

Operator

The next question is from Devanshu Bansal from MK Global. Please go ahead.

Devanshu Bansal, Analyst — MK Global

Hi, team. Thanks for the opportunity and congratulations to the Mardin Institution. So, I wanted to understand we have been taking quite a good step around improving our beta channel. So, but in this quarter also, we were slightly sort of negative. So, if you could just throw some light as in where we are in the journey for this particular channel, And how do you see this ramping up in the next few quarters will be really helpful.

Samir Khitarpal, CEO

So, we are very focused on data as a channel, and the question number two squarely tries to address that particular piece, and at least this quarter was the first quarter where at an overall revenue level we grew, right? So we have, I would say, from a... From the average daily sales perspective, we have a restaurant. Of course, the work is on in terms of store fitment, upgrading of value, launching best deals ever, solace occasion. So, a lot of things in motion. We hope we will, this quarter, we will improve further on the trajectory that we've been able to work. So I think it's the team, the set of initiatives, the customer proposition, a lot of that is already in execution.

Devanshu Bansal, Analyst — MK Global

Well, again, Samir, this mentions about refurbishments or improvement in furniture, etc. in 100 stores. Is this 20% of what we are sort of targeting? As in, are we targeting closer to 500 stores where we are planning to sort of improve our infrastructure? Is this the right understanding?

Samir Khitarpal, CEO

Yeah, about 400 odd stores.

Devanshu Bansal, Analyst — MK Global

About 400. Okay, and by when do we expect it to sort of do this infrastructure improvement completely? I think currently we are, I think, 100. So by when do we expect it to be done?

Samir Khitarpal, CEO

In about three quarters we should be done. These are not major changes. These are more front of the house changes. More furniture, color, paint. So that will continue to do.

Devanshu Bansal, Analyst — MK Global

Got it. And last one from my end, you did mention that chicken is sort of seeing inflation, but from gross margin perspective, we have done fairly well with water. Plus, we have indicated that there are 2-3 percentage more margin improvement labor from gross margin perspective. Okay. So, wanted to check in the near term, do you think that you'd be able to sort of sustain these level of gross margins? So, that is part number one. And secondly, since ABS is done, gross margin is done. So, wanted to check what is stopping us to sort of cramp up because all the levers that you mentioned in the letter, it seems to suggest that we are mostly done. So, can we expect an accelerated expansion for tokens?

Samir Khitarpal, CEO

I think we are on a good spot on Popois. We believe we have established the second growth engine for Jubilant Foodworks, built on product differentiation, service differentiation, and customer love. So, that has served us well. Having said that, the unit economics... Still need to be coming place at a restaurant profit level. So on gross margin, I agree we are happy with the trajectory because we are riding on the backbone or the economies of scale that Domino's brings in in terms of logistics, infrastructure management, procurement, etc. Having said that, I do believe there is another 200 basis point of gross margin improvement that we would like from here. So that's one. Second is the lines below, i.e. store operating cost, manpower, and marketing all need to flow in for us to come to the right restaurant profitability. And the work is on track. Answering your Uber question on why not accelerate, firstly, we know where, so we have about 100 stores. We know where to put the next 150, which takes us to a 1000 crore kind of a run rate business or more than that. So we are very clear of where we want to open the stores. We have a plan geography by geography. We will build the back-end supply chain and accelerate. So we are not starving the business on capital. The guidance remains about 40, 45, that's where we are operating. And if we get the right area, we will open faster. So it's not an intent issue. It is more of a making sure we operate with quality, build on the customer love that we are getting, and make sure the unit economics fall in place.

Devanshu Bansal, Analyst — MK Global

If you allow, I just had one small follow-up.

Samir Khitarpal, CEO

Why don't you finish and then I think it's fine. If there's one question, then why don't you finish?

Devanshu Bansal, Analyst — MK Global

Yeah, yeah. So I just want to check, we are already at similar ABS levels as other competitors are, right? And our gross margin is also, is in line or slightly better versus the competition. So wanting to understand why is the store level margin sort of still lagging behind in terms of profit, right? So maybe at what level of ADS you believe that you'll be able to sort of reach the targeted store margin level?

Samir Khitarpal, CEO

You know, I think that towards the things which are there, I think for sure we want the ADS to be closer to 100K or 1 lakh rupees. So that brings in enormous goodness into the pre-handle with this kind of gross margin profile. Like I said, the gross margin, I would say, has another 100 to 200 basis point opportunity. Then I think structurally... See, we have, we don't have a 30-year advantage of, so when we go to a high street or a mall, as the fifth, sixth USR player, our rentals are much higher, because when I compare it to Domino's, the leases were signed 10, 15 years ago, they do have that advantage. Secondly, on the store operations, These are very different set of operations, and we are optimizing, deploying technology to look at our manpower cost inside the store, and also making the, tweaking the equipment, CapEx, OpEx, to suit India. So those things are in place, and then marketing leverage has to come in, and like we are with 100 stores, we are in 25 cities. And we know that we will, to get to 250 stores or 1000 crores, we have to get to these cities. So, marketing efficiencies will also come. So, these are the levers, but the glide path is very, very clear on this one. And there is nothing structurally which is inhibition, it is more execution and getting both. Slightly higher scale per store and the number of stores which allow us to amortize our cost. We are a 100-store network, right? We are a 100-store network at this point, right? So just put that in context.

Operator

The next question is from Aditya Soman from CLSA. Please go ahead.

Aditya Soman, Analyst — CLSA

Yeah, hi. Good evening. Two questions. Firstly, on innovation. Thanks for sharing details on innovation in the quarter. Can you give us some sense of what the contribution from the innovation portfolio has been and how that has tended? And, and the second question again on Popeyes, just a quick one is, would the delivery mix on Popeyes be very different from other brands? I know it will be different from Domino's, but let's say if I compare it with the KFC, would the delivery mix be significantly different? Thank you.

Samir Khitarpal, CEO

Doesn't the second question is easier to know? I think there are industry... These are more choices, or industry, or consumer preferences, industry structures, or category structures. At delivery, dynamics will, in the medium term, will not be very different. So right now, we are maybe more focused on malls and more prominent high streets. As we penetrate my own senses, we will be around where McDonald's, Burger King, KFC would operate. Around the same vicinity. I don't expect it to be very different. Then the first question was on innovation contribution. Right, so we don't declare because this is sensitive, this is, like, competition can, but the, what I will definitely share is, Domino's as a brand, when I compare it to the industry and also my own four years in the company, in the last two or three quarters, Domino's has innovated the fastest, right? And with very purpose-driven innovation across three or four platforms that we keep on talking about. One is the cheese platform. So if you see the whole Korean range of cheese burst and volcano pizza and lava pool apart, so that continues and this quarter we launched two in one. Then the second was on the chicken, right? So that's one piece. We want to bring chicken and our non-veg share in the overall pizza mixes is low and we believe we have room to improve. So, the chicken size we had talked about, but this is the last quarter we've been launching something called Chicken Max, which is nothing but like all the toppings of chicken on top of it and with some sauces. So, high protein. So, that's number two. Then beverages, the other one. So, you saw cold coffee, right? Again, did extremely well this summer. So, I think the hour. It will be programmatic, platform-driven, and with a very strong above the line. And the mix, the share of... Revenue coming from new businesses actually has been going higher and higher by year. So, Suman, anything you want to add?

Suman Higde, CFO

I can give you a flavor, like we don't give out the numbers, but just to build on Samir's point, I'd say, so, you know, if we look at over the last year, right, on the platform that Samir has mentioned, right, be it Chicken Max, Paneer Max, you know, on high protein, and also Index 2, you know, where we know chicken is still a lot smaller contribution to the overall pizza segment for us, and in the south, it's a big market. So we have launched those. The double cheese burst on the cheese platform we talked about. Then Big Big Pizza, which was a big success. We launched cheese burst in that as well. And then we had new innovation in the beverages sector, which is a, you know, classic cold coffee. And then even desert, we have gone to the, from Chocolawa to improve attachments at the lower end of the price pyramid. We've launched the moose cakes, which kind of goes well with the Pizzamania attachment rate. So all of these put together, if you look at innovations over the last year, they're now significantly contributing to double-digit, almost double-digit contribution to our overall top-line growth. And these also make secretive points that we're putting in place. So it also augurs well for our gross margin product mix trajectory. So that's the way we are planning for how we want to do the innovation portfolio going forward. If that gives you a little bit more flavor on what your question was.

Aditya Soman, Analyst — CLSA

Yeah, absolutely. Thanks. Thanks, Samir and Suman. I basically just wanted to check if that mix is improving and clearly it is. So thanks again and wishing you a happy day.

Suman Higde, CFO

Thank you. Happy New Year.

Operator

Thank you. Next question is from Manoj Menin from ICICI Securities. Please go ahead.

Manoj Menin, Analyst — ICICI Securities

A happy Diwali team. Just one observation, I happen to see one location in High Street in which there is a dominoes and a Popeye, you know, both side by side. In fact, when you walk in, you know, both the counters are just next to each other, you know, these are common seating area, which essentially means the, you know, a lot of probably shared, let's say, you know, area, etc. Just trying to think about the perspective which you have, understand the perspective that, you know, is it a planned one, how many such stores you have, and what are the synergies at a product level, customer level, you know, if the customer will want for a Domino's and end up buying a poppies or both at a family level. At least the closest example I can think of is what Titan has, you know, executed over the years in terms of a Tanishk and a carrot claim, where the, let's say, younger generation, you know, in Tanishk may be redirected to the carrot claim so that at the catchment, you, you know, you capture the entire family's requirement. Maybe I'm thinking about it, just trying to understand the opportunity set, which is very unique to you in this aspect. Thank you.

Samir Khitarpal, CEO

I think it's a good observation you have. It's not programmatic, actually, I will say that. So we are doing it more opportunistically. And these are in three or four areas. So we have very good rentals and large stores in certain high street. You could have probably gone to Indranagar or Marathalli in Bangalore or one place in Coimbatore. So where we were, we had the right real estate, good rentals, and where we could fit in both the stores. And the only way to fit in the two stores and get the unit economics working for JFL as a whole was to do kind of a food court. Set up for the two and have a common seating areas. So these stores are ROI or Rossi Accretive to JFL. And we're doing it more opportunistically. It's not a program where the two brands go together, want to co-build the location. Whenever it happens in a mall or a food court or an existing high street store, we do it. The teams are synced up. I hope that answers. And it is obviously very accretive to us.

Manoj Menin, Analyst — ICICI Securities

I'm trying to understand that, you know, let's say both the brands may have a slightly different day part throughput. So to that extent, does it really result in your early days understanding, you know, better asset utilization, you know, is all I'm trying to understand.

Samir Khitarpal, CEO

We have the bikes, again, we have the common bike infrastructure, you have common seating, you have common supplies from commissary, so all those things, like I said, the margin profile is much better. Having said that, we have not really come to a conclusion where we can say this as a go ahead and open 100 such stores. And that customer feedback we are still evaluating. While there is better asset utilization and more fixed cost sharing across two brands, we have yet to fully assess how customers perceive it because some of the customer occasions, customer profiles may be different. So the jury is still loud, Manoj.

Manoj Menin, Analyst — ICICI Securities

Loud and clear, sir. One last anecdotal observation. I'll end and stop, you know, now. In fact, in one of the markets, I was surprised to find that, you know, apparently, I know it's anecdotal, so to that extent, those brands may excuse me for that. Apparently, Bluestone and Carrot Lane actually partnered to ensure that the TAM grew.

Samir Khitarpal, CEO

Okay, good. I think it's a good point. I think the pizza eaters will also be chicken eaters and vice versa. And we have the database to at least see what's the overlap. In fact, the store that we open, high street stores we are opening. We leverage the database that we have in terms of delivery dense areas, what are the right times. So we're already leveraging the common infra-Avi.

Manoj Menin, Analyst — ICICI Securities

Thank you, and all do that, Samir. Thank you.

Operator

Thank you. The next question is from Avi from 361 Capital. Please go ahead.

Abhi Mataji, Analyst — 361 Capital

Yeah, hi, team. Thanks for this opportunity. This is Abhi Mataji from 361. Two questions. You know, we have, you have, given the conversation, so now you have a much better handle on input inflation, it seems, and you have delivered this quarter of IOI margin expansion as well. I wanted to kind of get your thoughts on how do you see the medium term kind of panning out and, you know, the guidance or the thoughts that you had on trying to kind of reach that 200 bits expansion. How do you feel about that? That was the first bit, if you could kind of share some thoughts on this. Thank you.

Samir Khitarpal, CEO

I know, Abhi, I think sometimes it's like you work with the plan towards that goal of 200 basis points and then like more surprises get you like LPG pricing and then leading to increase in wage inflation across various states. So, I think our plan and the initiatives were very clear. If you see... It bordered on just two areas. One was reducing the drag of emerging brands and let me not say Popois is no longer emerging. Popois and let's say Horns, right? So that bit is actually ahead of the plan, right? We said 100 basis points and we feel very, very confident about it and we're showing them the numbers. Now, Domino's team, unfortunately, they took all the initiatives. From pricing, cost per delivery, discount reduction, store operating cost, marketing, mix modeling, etc. They've been hit by 200 basis points of unforeseen, unplanned costs very suddenly, but they've been able to... I'm hoping at some point the war will end and the oil prices will come back and we will enjoy these margins. If not, we have more levers in our pocket that we will pull and get that without hurting the growth. So that's the challenge over there. We, as you will hear in our commentary and tone, we are more confident about getting the margin profile that we want.

Abhi Mataji, Analyst — 361 Capital

Okay, sir. Okay. So, got it, sir. I hear you. The second, which is just a conceptual bit on Turkey, you know, we have seen, yes, I do, you know, we've heard your, I said, for the shareholder letter about there being the impact on the reported EBITDA, but how does the negative LFL, does that on an operational basis also kind of? I'm just trying to better understand that there are two moving parts here, the LFL being negative, and if that is changing, it is what I wanted to better understand. And if it remains here, how should we look at the margin profile over here at an operating level?

Samir Khitarpal, CEO

I think it's a little deeper answer to your question. So let's first segregate dominoes and coffee. Good, ominous. Average order growth per store is positive. They've been able to take price hikes ahead of the own inflation, the inflation that the company has faced. But yet the LFL is negative. So let me just repeat, transaction growth is there at a store level. They, whatever inflation we saw in our P&L, we've been able to pass on to the customers. Right? And yet the LFL is negative. So it's a, therefore, it only points to accounting, some certain accounting. Treatment, you have to do as per the accounting policies, which is the government gives you a headline inflation number, and to that extent, you have to reduce or adjust your revenue to come to life for life growth. And that number is the standard number across the country or across the industry. As a result, your inflation may be lower than that, which means you've been able to hold margins. So long story short. On Domino's, the team has done well to grow transactions, pass on the cost to the customers, ensure that the franchisees are profitable and with the company, and it's, I would say, it is more accounting, which has, which explains the LSE. So from a business standpoint, there is no worry, and you will have... Some of these adjustments end up in both ways, right? Sometimes positive, sometimes negative. Now let's come to coffee. Right, coffee, we did see very high prices of coffee last year. We had to pass it on to the customers and therefore the whole plank of being value-led was kind of shaken and the teams have corrected that. They've also doubled down on opening stores near universities, which is the young Gen Z population that they are targeting that pieces on, so their app growth, loyalty programs. And the stores are beginning to work. Plus, equally, they are working on a portfolio which differentiates them from the Starbucks and Espresso Lab and some of the other players that exist to make it more youthful and make it more cold beverages and tech driven. So that work is on. And it seems quarter on quarter, they are actually doing better versus this quarter versus last quarter.

Abhi Mataji, Analyst — 361 Capital

Okay, very clear, sir. So just a request, maybe, I don't know whether it's possible, but in a way, is there any disclosure possible to just understand this on operating level? Because it's, as you said, there is a huge accounting thing that keeps happening, and it's getting hard to just appreciate these nuances, which is very nicely explained. Thanks a lot for that, sir.

Samir Khitarpal, CEO

I mean, we'll see if we can give you without inflation numbers, that's always kind of, that's a local currency, lira to lira, we'll see how much of that helps. But I will encourage you and the analyst colleagues to actually go visit the country. And we should arrange for that maybe at some point of time. That actually will kind of help you get a sense of how dynamic the country is. We earn in Liras, we spend in Liras, the currency is very readily exchangeable to all, like dollar or euros, we are growing in dollar terms, the country is growing in dollar terms, so some of these, while there are accounting treatments, which, and the pluses and the minuses, and also the currency changes from lira to rupee. Can make the numbers less intuitive, but once you go see the country, you feel, you come back very charged and convinced about the market opportunity that exists.

Abhi Mataji, Analyst — 361 Capital

No, sir, this is clear. Thanks a lot, sir, for all this, and wish the team a very happy Diwali. Thank you very much.

Suman Higde, CFO

Thank you. Wish you a happy Diwali. Thank you.

Operator

Thank you. The next question is from Naveen Trivedi from Motila Loswal. Please go ahead.

Naveen Trivedi, Analyst — Motilal Oswal

Yeah, good morning, Samir and team, for a very steady performance during this time. Can you just give us some comment about this near-term demand side, especially when we give 5% to 7% medium-term SSG, given at the first half SSG, do you think this year also this medium-term guidance is manageable, especially when the implied number looks like if they achieve this number, then we'll be more like 6% to 8% sort of SSG brand for second half? That's the first question.

Samir Khitarpal, CEO

I think we want to get to 5-7% for the year, right? And I don't want to raise any expectations. So, water on any expectation, cold water on any expectation. I think we, I think what should give you confidence is trajectory from Q4 to Q1 to Q2. And like I said, we, as far as Q3 is concerned, we seem to be on track to meet our plans that we have when we start. So beyond that, I don't have anything to share. Like I said, the next week or the next seven, eight, ten days are most crucial, very heavy days. And then you have similar set of seven, ten days from year Christmas time, right? Those can materially change the number, right? Like by a hundred to two hundred business point.

Naveen Trivedi, Analyst — Motilal Oswal

So my question was more to understand the, given there are multiple questions about the consumption side, especially in the discretionary consumption side, are we seeing the consumption trends by and large still maintaining because a lot of staple companies also mentioned about rural side, urban side, very steady state consumption trend. How are we seeing last, maybe the exit of the quarter, maybe October, you have seen some sort of a color about demand side. So are we seeing that there is a steady state consumption pattern, there is no change from that point of view?

Samir Khitarpal, CEO

So I think for a QSR company with just only 2,500, 2,600 stores, To take a view on India-level consumption is very, very difficult, right? And I wish I could answer you. And we are not a rural, we don't have this rural or urban. We are like 120% urban as it gets, right? We may be in Meret or we may be in Badam, but we are in the urban part of that particular district, right? So we are not in a Taluka or a Taiseel or a Panchayat or a village, right? So, we are not in those, unlike some of the FMCG brands, and we are very underpenetrated, unlike... Let's say a toothpaste or a soap, right, where some of these things matter. So for us, it's more about how we execute, how we manage the channels, and how much delight we can pass to the customer and still be very focused on value. So, I don't feel, and if you see, most USR companies have reported very positive growth. So, I don't think some of the rural pressures because of monsoon or the other factors which may be there is impacting us. It may come in more in inflation, right? That's where we worry more, but less on demand side.

Naveen Trivedi, Analyst — Motilal Oswal

Yeah, thank you so much from my side, and happy Diwali to everyone. Happy Diwali.

Operator

Thank you. The next question is from Gautam Rathi from CWC. Please go ahead.

Gautam Rathi, Analyst — CWC

Hey, hi. Thanks for taking my question. Can you just help us understand a bit more on the diamond piece, right? There looks to be a positive momentum finally after a long time. So these 20% stores which have been refurbished already, what is the kind of growth you are seeing there so that we can just, you know, think about how this could play out over the next? 12, 18 months when you refurbish the other ones, right? That is one. And second is, also, can you speak a bit about your venture on the cafe side, Domino's Cafe? How many stores? How is it looking like? Any indication? And how is it helping the dine-in do, right? Yeah, that's it. Thanks.

Samir Khitarpal, CEO

Yeah, the, I think the, um, um, the... See, cafe is very small, right? They are like 15, 20 stores, and it does add material to average daily sales or like for like. Most of it is dining. That's the very early read on it. I think we need time to fully understand the economics, customer profile, payback periods for us to fully declare victory or defeat other of any way. So, so, um... So, I will hold that comment, but no negative surprises on that front at the moment, and how we envisage to have a Domino's Cafe focused on value that seems to be resonating reasonably well with the customer, and we have to see what we can tweak over there. On the dining takeaway, see, I will not... Like want to color whether I have painted a store and therefore it led to X percentage growth and I change the door plus X plus Y. So my take on that one is, see it's a program and the program has three or four legs. One is making sure this. The stores, we will always be a functional brand. We will always be delivery focused in that context, right? What should a store experience look like? So that we'll continue to renovate, continue to fix. Second is we have to give disproportionate value for customers to come in, carry out or eat in over there versus delivery. And over the years, that piece has been diluted and we are therefore taking those corrective actions. And number three is... Ensuring that our technology, our people inside the store, everything works together seamlessly in serving the customer, whether it's a restaurant manager, reaching out to the local condominiums or households through technology-led local store marketing or CRM-led local store marketing and building that neighborhood connect. So these are the three pillars that we have, right? Make sure in the context, stores continue to be inviting. The customers will come in for value, disproportionate value when it comes to carry out or dine in. And we ensure that we continue to be the neighborhood love store that we've always been.

Gautam Rathi, Analyst — CWC

Oh, sure. Thanks. But Samir, it's just one thing. In the medium term, right, say next to 18 months or two years, do you see this growth rate for delivery and dine-in at least being the same so that at least the mix stays here? Do you expect that to happen?

Samir Khitarpal, CEO

Yeah, so I think what I want is like the, I don't want dine-in takeaway to be a headwind. So, like if you see last 2-3 quarters, even in Thutu, our delivery continues to grow, and some of the stores that they do, like they deliver, even in late night, I am just mind boggled to see the numbers, how fast the delivery is growing. So that's hard to take. And what we're trying to do is like ensure that the dine-in takeaway is not a headwind. If we can add whatever 1-2% to LFL, it just completely changed the growth trajectory and also the margin profile of the company. So that's how we are focused on it versus making us a delivery dine-in brand.

Gautam Rathi, Analyst — CWC

Got it. Perfect. Thanks a lot and a greeting to the festival. Thanks.

Samir Khitarpal, CEO

Thank you. Thank you, everyone.

Operator

Thank you very much. We'll take that as the last question. I would now like to hand the conference over to the management team for closing comments.

Apar, Head of Investor Relations

Thank you, everyone, for joining the call and for listening patiently. For any further questions, you may reach out to the Invest Relations team. You will find the recording and transcript of this call on the Invest Relations page of our website very soon. Thank you, and have a great evening. Wish you very happy, Diwali.

Suman Higde, CFO

Wish you all a very happy, Diwali. Thank you.

Operator

Thank you very much. On behalf of Jubilant Foodworks Limited, that concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.