Mumbai — Devyani International Limited, which operates leading quick service restaurant (QSR) chains such as KFC and Pizza Hut in India, slipped into a loss of Rs 23.9 crore in the second quarter of FY26, compared to a profit of Rs 2.2 crore in the previous quarter (Q1 FY26).
On a year-on-year basis, the company’s losses deepened sharply by 367 per cent from Rs 4.9 crore in Q2 FY25, according to its filing with the stock exchanges.
The company attributed the setback to a decline in out-of-home consumption, as both Shraavana and Navaratri occurred during the same quarter, impacting footfall and sales. Additionally, unseasonal rainfall — particularly across eastern India in the latter half of September — further dampened performance.
Despite the loss, Devyani International’s consolidated revenue rose 13 per cent year-on-year to Rs 1,377 crore, driven by network expansion with 263 new outlets opened in the past year, taking its total store count to 2,184.
Revenue from KFC India stood at Rs 572.3 crore, marking a 5.3 per cent increase over the previous year. However, the company’s EBITDA margin contracted to 14.1 per cent from 16.3 per cent a year ago, impacted partly by losses from its acquisition of Sky Gate Hospitality — the parent company of Biryani by Kilo.
The company also pointed to sluggish urban demand and rising competition from local restaurants as contributing factors, noting that discretionary consumption is only gradually recovering after a period of muted growth.
Earlier this year, Devyani International announced partnerships with three international brands — New York Fries, Tealive, and Sanook Kitchen — to diversify and strengthen its brand portfolio.
Post-Dussehra, the company reported improving momentum in business from Biryani By Kilo and Goila Butter Chicken, both part of the Sky Gate portfolio. It added that the integration of Sky Gate with Devyani International remains on track and is expected to reach brand contribution break-even by March 2026.
With inputs from IANS