Conference Call with Devyani International Management and Analysts on Q2FY26 Performance and Outlook. Listen to the full earnings transcript.
Restaurants company Devyani International announced Q2FY26 results Q2 Revenues stood at Rs 13,767 million, up 12.6% YoY. KFC India: Rs 5,723 million, up 5.3% YoY. Pizza Hut India: Rs 1,860 million, up 0.6% YoY. International business: Rs 4,495 million, up 14.0% YoY. Q1 EBITDA at Rs 1,943 million, with EBITDA margin at 14.1%. Ravi Jaipuria, Non-Executive Chairman, Devyani International, said: “Q2 saw perhaps the most important policy development for consumers and the retail industry with the transition to GST 2.0 – a historic move to simplify and harmonize the GST framework to a 2-tier structure. While it’s still early to assess the results of this transition, the initial signs are encouraging, and all of us have seen a significant upside in certain consumption categories like Automobiles and Durables. The impact of the change has been very minimal on the QSR category and our business. We have already passed on the benefits of reduced input costs to our consumers. Overall, GST 2.0 is a welcome move to broaden the consumption story in India. We continue to expand our store network with 30 net additions to KFC and another 3 net additions to Pizza Hut. We started rolling out the stores for Tealive and launched the brand with 6 new outlets during the quarter by way of test launch. The initial Customer feedback is positive, and we plan to expand the brand after the test launch phase. Biryani By Kilo and Goila Butter Chicken from Skygate portfolio continue to do well, and we have seen a strong momentum in the business post Dussehra. The integration of Skygate with DIL remains on track. As shared earlier, our goal is to achieve brand contribution break-even by March 2026, and we are pleased to report steady progress towards that milestone. We remain confident of meeting this target. Being a festive quarter, our promotions targeted both the topical events (e.g. Pujo and Onam specials) as well as the core offerings. KFC saw pan-India launch of the “Chana Chatpata Burger” – attractively priced at Rs 69 and comprising of protein rich vegetarian patty. We have also started rolling out a new grilled chicken offering and new limited time offerings (LTOs) in the beverages and desserts category. We launched Ultimate Cheese crust in Pizza Hut across all channels. Customer response has been enthusiastic encouraging us to expand the offering to combos and meal offers as well. Out-of-home consumption was impacted due to both Shraavana and Navaratri falling in the same quarter, as well as unseasonal rains – especially in eastern parts of the country during the crucial second half of September. Despite external factors, our consolidated revenues grew to Rs 1,377 crore – a 13% YoY growth. The resilience of our brands and our disciplined execution has enabled us to grow despite the headwinds. With our strong foundations and diversified portfolio, we remain well positioned to capture upcoming opportunities and deliver sustainable, profitable growth.” Result PDF
Restaurants company Devyani International announced Q1FY26 results Q1FY26 Revenues stood at Rs 13,570 million, up 11.1% YoY. KFC India: Rs 6,126 million, up 10.5% YoY. Pizza Hut India: Rs 1,873 million, up 3% YoY. International business: Rs 4,332 million, up 11.2% YoY. Q1FY26 EBITDA at Rs 2,049 million, with EBITDA margin at 15.1%. Ravi Jaipuria, Non-Executive Chairman, Devyani International, said: “India’s QSR industry is on a structural growth trajectory underpinned by rising urbanisation, growing income levels, increasing digital adoption, an increase in female work participation rate and a growing appetite for convenience, esp. among younger consumers. While near-term macro factors have led to a phase of soft consumer demand, we see a better outlook for the industry in the coming times. We are learning from the evolving consumer trends, and we need to reset our business to have a differentiated and compelling proposition for our consumers, whether they are online or offline. We strongly believe that our industry will remain a prime beneficiary of evolving consumer behaviour. It’s important that job creation continues in the economy with rising per capita income, which will lead to higher consumption. Considering the significant market potential, we continue to execute on our long-term growth agenda. I am pleased to announce that we have concluded the acquisition of Sky Gate Hospitality, which runs “Biryani by Kilo” and “Goila Butter Chicken” brands, and increased our stake to 86.13% subsequently. This gives us access to market-leading brands to expand our presence in the Biryani and Indian cuisine segment – one of the largest food categories in the country. Sky Gate Hospitality has 105 outlets at present, and we are confident that these brands will be one of the key contributors to our expansion plans going forward. Our financial performance has been healthy. On a consolidated basis, Q1 revenues reached Rs 1,357 crore, a 11.1% YoY growth. This growth was driven by healthy growth from KFC, Costa and the Food Court business in India and supported by 11.2% YoY growth in the international business. Reported EBITDA came in at Rs 205 crore with EBITDA margins at 15.1%. The slight dip in margins was due to deleverage from lower ADS YoY and investments in marketing and promotions in the quarter. As one of the leading QSR players, we are well-positioned to benefit from the rebound in consumer spending. Our multicuisine, multi-format strategy caters to a broad spectrum of consumer tastes, occasions, and price points, while diversifying away from any category or geography-specific risks. It also enhances our ability to capture opportunities across varied markets and evolving consumer trends. With the strength of our brands and our execution capabilities, we are confident of our ability to deliver consistent growth. Our focus will remain on scaling profitably, strengthening both our core and emerging brands, and creating long-term value for all stakeholders.” Result PDF