Devyani International -
Q3 FY 24 results and concall highlights -
Revenues- 843 vs 790 cr
Gross margins @ 70.6 vs 70.8 pc
EBITDA - 146 vs 173 cr (margins @ 17.4 vs 22 pc)
PAT - 5 vs 71 cr ( due materially higher interest and depreciation costs, Devaluation of Nigerian currency and subsequent hit of 12 cr against the same )
Brand - New Stores addition in Q3 - Grand Total
India -
KFC - opened 50 stores - total @ 590
Pizza Hut - opened 30 stores - total @ 565
Costa Coffee - opened 8 stores - total @ 154
Vaango - opened 1 store - total @ 54
Others - did not open any stores - total @ 24
Nepal -
KFC - opened 3 stores - total @ 25 stores
Nigeria -
KFC - opened 2 stores - total @ 40 stores
Thailand -
Acquired Restraunts Development ltd in Q3 - operating 283 KFC stores in Thailand. Deal completed in Jan 24
Brand wise performance -
KFC -
Avg Daily sales per store @ 1.04 vs 1.16 lakh
Total sales @ 524 vs 459 cr
Gross Margins @ 69 pc vs 68 pc
Pizza Hut -
Avg Daily sales per store @ 37 vs 43 thousand
Total sales @ 179 vs 183 cr
Gross margins @ 76 vs 74 pc
Costa Coffee -
Avg Daily sales per store @ 35 vs 37 thousand
Total sales @ 40 vs 29 cr
Gross margins @ 77 vs 78 pc
Company is present in > 250 cities in India
Q3 saw subdued consumer sentiment. Weakening in Nigerian currency also continued in Q3. As the consumer sentiment changes, company’s performance should turn around
Company is likely to Hit a total of 2000 stores by Dec 24 - 2 yrs ahead of time, helped by the Thai acquisition
The performance of KFCs acquired in Thailand will get reflected in the consolidated results of Q4 FY 24. Company intends to introduce other brands in Thailand
Company estimates that the Nigerian business may continue to need support for next 1-2 yrs as well
The operating margins of the Thai business are 3-4 pc lower than the Indian KFC business. Company intends to improve these margins to bring them at par with India KFC margins
Total consideration for the Thai Acquisition is 1060 cr. DIL shall invest aprox 340 cr upfront out of that. Temasek will invest another 340 cr. DIL and Temasek will invest the remaining amount after obtaining bank funding. DIL shall hold 51 pc and Temasek shall hold 49 pc in the acquired entity
Despite the slowdown in consumer sentiment, the company’s store expansion remains strong ( except Pizza Hut - where the company is not being so aggressive ) This is due to their belief that the consumer sentiment should turn around at some point in time
Thai business won’t require any fresh cash infusion. Its a self funded business
Pizza Hut is facing a lot of completion from the local players. At the same time, these local players are helping Pizza category become the biggest QSR category in India
**Broad store opening tgt for FY 25 - **
KFC @ 130-140 stores, Pizza Hut @ 60-70 stores, Costa Coffee @ 50-60 stores
Disc: hold a small tracking position, will add only if the performance improves, biased, not SEBI registered
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