Devyani International drops 5% after Q3 swings to loss from year-ago profit

Devyani International shares have tanked 6 percent since the start of the year.

Shares of Devyani International, the operator of Pizza Hut, tumbled 5 percent to Rs 169 on the afternoon of February 11 after the company reported a consolidated loss of Rs 49.2 lakh for the quarter that ended December 2024, a sharp reversal from a Rs 9.6 crore profit in the same period last year.

This decline came despite a 53 percent surge in revenue from operations to Rs 1,294 crore. A key factor was a Rs 2.9 crore foreign exchange loss, contrasting with a Rs 3 crore forex gain in the year-ago quarter.

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However, the performance of key brands showed mixed trends. Despite the festive quarter, KFC's same-store sales—measuring revenue from outlets operational for at least a year—declined 4.4 percent, marking the second straight quarterly drop after a 7 percent fall in the previous quarter.

Vaango, Devyani’s South Indian cuisine brand, continued to outperform. Popular in airports, it posted 9.6 percent same-store sales growth, following an 11.5 percent rise in the preceding quarter, with quarterly revenue of Rs 2.4 crore.

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Pizza Hut saw a 0.8 percent drop in same-store sales, a notable improvement from a 5.7 percent decline in the September quarter and a 12.6 percent fall a year ago. Costa Coffee's same-store sales growth stood at 5.1 percent, moderating from 8.7 percent in the previous quarter but improving from 5.9 percent a year earlier.

Profitability showed an uptick, with EBITDA margin improving to 17.4 percent, compared to 16.3 percent in the previous quarter and 16.9 percent a year earlier.

The Mumbai-based quick-service restaurant operator continued its aggressive expansion, adding 101 stores in India, nine in Thailand, and one in Nigeria during the quarter. "DIL has successfully met its store expansion target, surpassing 2,000 outlets ahead of schedule," Chairman Ravi Kant Jaipuria said in a stock exchange filing. The company now operates 2,032 stores across four countries: 1,658 in India, 305 in Thailand, 29 in Nepal, and 40 in Nigeria.

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At about 2:30 pm, Devyani International shares were trading at Rs 172, lower by 3.3 percent from the last close on the NSE. Devyani International shares have tanked 6 percent since the start of the year.