Devyani International shares slip 3% on Q2 loss, revenue rises

Devyani International shares slipped 3% on Thursday after the KFC and Pizza Hut operator reported a net loss of ₹21.8 crore for the September quarter against a marginal profit of ₹0.02 crore from the same period last year.

Despite the loss, the company recorded a 12.7% rise in revenue to ₹1,376.7 crore against ₹1,222 crore a year ago. Following the earnings announcement, shares of Devyani International fell 2.79% to ₹155.20 against the previous close of Rs 159.70. The stock is down 15% so far in 2025. EBITDA slipped 1.8% to ₹192 crore while margins contracted to 14% compared to 16% last year.

Expanding its footprint, Devyani International grew its network to 2,184 stores, adding 39 net new outlets during the quarter, including 30 new KFC restaurants in India.

The company highlighted the transition to GST 2.0 as a significant development, with Non-Executive Chairman Ravi Jaipuria stating: "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 harmonise 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."

Devyani International competes with other quick service restaurant (QSR) operators in India, including Jubilant FoodWorks, Westlife Foodworld, and Restaurant Brands Asia. The recent results and operational updates come amid sector-wide adjustments to new GST norms and evolving consumer demand in the QSR market. The company’s operating margins and profitability remain under pressure, but ongoing store expansion and policy adjustments are expected to shape its future performance.