Street View: India's Sapphire Foods slides as cost pressures cloud margin outlook

By Reuters News

** India's Sapphire Foods SAPI.NS reported narrower Q2 net loss of 15 million rupees (around $158,000), compared with 127.7 mln rupees a year earlier

** EBITDA margin fell to 14.3% from 15.7% sequentially

** Co's shares slide as much as 4.9% to 186.30 rupees


RISING COSTS THREATEN MARGIN RECOVERY

** UBS ("buy", TP: 250 rupees) says stronger-than-expected sales growth, driven by value offers and a favourable festive calendar, could come at the expense of margins as food, wage and energy costs rise

** JPMorgan ("overweight", TP: 230 rupees) says inflationary pressures are likely to peak in Q3FY27, weighing on near-term margins even as value offers drive customer growth

** BofA ("underperform", TP: 185 rupees) says growth through discounts and higher spending is likely to keep earnings under pressure; cuts FY27-FY29 earnings estimates by 1%-6%

** Dolat Capital (downgrades to "reduce" from "accumulate"; cuts TP to 200 rupees from 210 rupees) says inflation and higher marketing spending could limit profitability improvement despite strong KFC sales; trims FY27-FY29 EBITDA estimates by about 2%




($1 = 94.9400 Indian rupees)

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