Quick service restaurant operator Devyani International witnessed a slight uptick in demand in metro cities in the October-December quarter, non-executive chairman Ravi Jaipuria said on Tuesday. “While the overall consumer sentiment remained subdued during the festive season, the QSR sector in general and Devyani witnessed some green shoots of recovery in metro and large cities,” he said on a call with analysts after the announcement of the Q3FY25 results. The company reported a net loss of Rs 7.6 crore mainly due to a deferred tax liability of Rs 16.2 crore. In the same quarter in FY24, it had reported a profit of Rs 5 crore.
Total expenses were up 54% to Rs 670 crore, while Ebitda improved from Rs 146.3 crore to Rs 219.2 crore, slightly below Street estimates of Rs 220 crore.
“We have seen bigger throughput happening on festival days, indicating that the consumers are opening up their wallets,” chief financial officer Manish Dawar said.
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This comes at a time when a slowdown in urban areas in the past 8-10 quarters has kept the overall demand muted, impacting the financials of consumer companies.
Devyani, which operates KFC, Pizza Hut restaurants and Costa Coffee outlets, said it is witnessing an improvement in same-store sales.
While same-store sales continue to fall for its key brands, KFC and Pizza Hut, by 4.4% and 0.8%, respectively, the decline is less steep than the 4.7% and 12.6% in Q3FY24.
For Vaango India, the company’s brand which sells South Indian food, the same-store sales grew 9.6% in Q3FY25, as compared to a decline of 3% in Q3FY24. Costa Coffee, however, has seen a fall in same-store sales growth (SSSG) from 5.9% to 5.1% during the quarter.
During the quarter, the company’s revenue from operations rose 54% to Rs 1,294.4 crore year-on-year, mainly due to its strategy of rapid store expansion. It was marginally below the Bloomberg consensus estimates of Rs 1,298 crore.
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