Last Updated on February 5, 2024 by ethinos
Table of Content
Expansion and Growth Strategy:
- Devyani International Limited (DIL), a prominent player in India’s Quick Service Restaurant (QSR) sector, showcased robust expansion and growth in the third quarter of fiscal year 2024 (FY24).
- DIL bolstered its growth strategy by acquiring 283 KFC stores in Thailand, further solidifying its position as a leading QSR player.
- This acquisition propelled DIL’s total store count to 1,735 across all geographical locations, surpassing its initial target of reaching 2,000 stores by the end of 2026.
- The company aims to achieve this milestone by the end of 2024, demonstrating its accelerated growth trajectory.
Additional Read: Q3 Results Dashboard
Performance in India:
- Despite challenges posed by a challenging macroeconomic environment and subdued consumer sentiment, DIL displayed resilient performance across its core brands in India.
- In Q3 FY24, DIL added 94 new stores in India, significantly expanding its footprint across various brands and geographies.
- The company remains committed to its growth trajectory and is on track to open 250 to 275 outlets in the current fiscal year, underscoring its confidence in the long-term potential of the Indian QSR industry.
- As of December 31, 2023, DIL operates 647 KFC stores, 570 Pizza Hut stores, and 154 Costa Coffee stores in India, totaling 1,452 system stores across its existing geographies.
Financial Performance:
- Revenue from operations in Q3 FY24 amounted to Rs. 8,431 million, primarily driven by new store additions.
- The reported EBITDA post-IND-AS stood at Rs. 1,463 million, resulting in an EBITDA margin of 17.4%.
Chairman’s Commentary:
- Mr. Ravi Jaipuria, Non-Executive Chairman of Devyani International Limited, expressed excitement about the successful completion of the acquisition of Restaurants Development Co Ltd (RD) in Thailand.
- Despite subdued consumer sentiments, Jaipuria remains optimistic about witnessing a recovery in consumer spending over the next few quarters.
- DIL’s operating and financial performance remained stable amid challenges, and the company continues to invest in long-term growth.
- Following the Thailand acquisition, DIL is confident of achieving its ambitious goal of reaching 2,000 stores by the end of calendar year 2024.
Key Developments:
Entry into the Thailand Market:
- DIL entered the Thailand QSR market through a strategic acquisition by acquiring controlling interest in Restaurants Development Co., Ltd. (RD), operating 283 KFC restaurants across Thailand as of December 31, 2023.
- The acquisition was successfully completed on January 17, 2024.
Continued Momentum on Growth Strategy:
- In Q3 FY24, DIL opened 94 net new stores, bringing the total store count to 1,452.
- The company is on track to open 250–275 new stores in FY24, pursuing a dynamic store expansion plan.
Revenue Performance in India:
- India business witnessed a growth of 9.2% over the same period of the previous financial year.
- Core brand revenues in Q3 FY24 include KFC at Rs. 5,243 million, Pizza Hut at Rs. 1,796 million, and Costa Coffee at Rs. 397 million.
Consolidated EBITDA:
Consolidated EBITDA stood at Rs. 1,463 million with an EBITDA margin of 17.4%.
Additional Check: Devyani International Share Price
About Devyani International Limited
Devyani International Limited (DIL) stands as the largest franchisee of Yum Brands in India and is one of the major operators of chain quick service restaurants (QSR) in the country, operating approximately 1,400 stores across India, Nigeria, and Nepal as of December 31, 2023. Alongside its operations as a Yum Brands franchisee, DIL also serves as a franchisee for the Costa Coffee brand in India.
Yum! Brands Inc., the parent company of KFC, Pizza Hut, and Taco Bell brands, is a global entity with a presence spanning more than 54,000 restaurants across over 155 countries.
Costa Coffee, established in London by Italian brothers Sergio and Bruno Costa in 1971, boasts a global presence across 41 countries, with over 2,800 coffee shops in the UK&I alone and more than 1,100 globally.
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Source: https://www.bseindia.com/xml-data/corpfiling/AttachLive//4aa93cad-9319-42ca-b8bf-065286483758.pdf
