Devyani International shares in focus as firm raises stake in subsidiary 

Shares of Devyani International are in focus today after the  quick service restaurant operator said it would raise its equity stake in Sky Gate Hospitality Private Limited. The firm will invest up to Rs 106.25 crore for 86.13% stake against the earlier 80.72%. 

The stock ended 0.03% higher at Rs 166.75 on Monday against the previous close of Rs 166.70. Market cap of the firm stood at Rs 20,147 crore. 

The company said it has executed a Share Subscription Agreement and Shareholders Agreement with Sky Gate and its founders, as well as a Share Purchase Agreement to acquire additional shares from the promoters. The acquisition is to be completed on or before July 31, 2025. It will be done via cash consideration and in one or more tranches.

Sky Gate Hospitality is a  subsidiary of Devyani International. It owns a portfolio of fast-growing foodservice brands including ‘Biryani By Kilo’, ‘Goila Butter Chicken’, ‘The Bhojan’, ‘Get-A-Way’, and ‘Krazy Kebab Co.’ As of March 31, 2025, Sky Gate's paid-up capital stood at Rs 20.23 lakh and its unaudited consolidated turnover (excluding two units) was around Rs 277 crore for FY25.

The objective of the fund infusion is to strengthen Sky Gate’s operations, support further investments in its subsidiaries, and meet general corporate needs.

While the transaction falls under the category of related party transactions due to the subsidiary relationship, the promoter group of Devyani International does not hold any stake in Sky Gate, and the deal is being executed at arm’s length.

Incorporated in 1991, Devyani International is engaged in the business of developing, managing and operating quick service restaurants and food courts for brands such as Pizza Hut, KFC, Costa Coffee, and Vaango.