Westlife Foodworld reported its Q1 FY26 financial results with a topline growth of 6.7% year-on-year, reaching Rs 6.6 billion, slightly missing the estimate of Rs 6.7 billion. This growth was driven mainly by a modest 0.6% increase in same-store sales. Despite this positive topline growth, the company witnessed a significant contraction in net profit, which plunged by 62% to Rs 1.22 crore for the quarter.

Yes Securities has reassessed its stance on Westlife Foodworld in light of these results and recent market movements. The brokerage downgraded the stock’s rating to ‘Add’ from a previous, more bullish outlook. The rationale behind this shift is attributed to the substantial price run-up the stock has experienced recently, which, according to Yes Securities, caps the potential upside in the near term.

Investors should be cautious as the company’s performance reflects challenges in margin expansion despite revenue growth, and the stock’s recent rally may have already priced in expected future gains. The downgrade to ‘Add’ signals a more measured approach, suggesting that while Westlife Foodworld remains a decent investment, the opportunities for significant short-term price appreciation may be limited.