Devyani (DEVYANI) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 consolidated revenue grew 11.1% year-on-year to INR 13,570 million, driven by KFC, Costa Coffee, and international business, with store count reaching 2,145 and 106 net new units added.

• Acquisition of Sky Gate Hospitality (Biryani By Kilo, Goila Butter Chicken) completed, increasing stake to 86.13% and adding 105 outlets, expanding presence in Indian cuisine.

• Multi-cuisine, multi-format strategy continues to diversify risk and capture evolving consumer trends.

• New international brands (New York Fries, G-Life, Sanook Kitchen) to launch next quarter.

• Consolidated profit after tax for the quarter was INR 22.28 million, compared to a loss of INR 167.63 million in the same quarter last year.

Financial highlights

• Q1 FY26 revenue from operations: INR 13,570 million, up from INR 12,219 million in Q1 FY25.

• Consolidated EBITDA at INR 2,049 million, EBITDA margin at 15.1%, down from 18.3% in Q1 FY25.

• Gross margin at 68.2%, a decrease of 1% year-over-year.

• Profit after tax at INR 22 million, compared to INR 224 million in Q1 FY25.

• Brand contribution margin declined to 13.1% from 15.3% last year, mainly due to lower Indian margins.

Outlook and guidance

• Focus remains on scaling profitability, strengthening core and emerging markets, and creating long-term stakeholder value.

• Management expects improved industry outlook as macro headwinds subside, with continued focus on profitable scaling and brand strengthening.

• KFC on track to open 100-110 net new stores in FY2026.

• Pizza Hut organic expansion to slow, aiming for positive SSSG.

• Turnaround of Sky Gate Hospitality targeted within 12 months for positive brand contribution.