India’s QSR chains see demand recovery as value offers draw customers back

Fast-food chains saw demand return in the September quarter as ₹99-type value deals pulled diners back, led by Burger King and McDonald’s franchisee Westlife, with Pizza Hut still behind. Rising gas, wage and ingredient costs are squeezing margins, so chains are holding back on price increases.

Cheap meals are bringing Indians back to burger joints. In the September quarter, the firms behind Burger King and McDonald’s in India saw sales at their existing restaurants grow by double digits, as low-priced deals pulled customers back again.

The recovery is uneven with some quick service restaurants (QSRs) like Pizza Hut, run by Devyani International, still reporting falling sales at established outlets, while KFC and Domino’s grew more slowly than the burger chains.

The catch is cost as gas, power, wages and ingredients all cost more, and the chains are leaning on bargains to get people to visit more often. Westlife Foodworld, which runs McDonald’s in west and south India, said rising costs ate up more than 1.9 percentage points of its profitability. Jubilant FoodWorks, the Domino’s operator, put its own hit at about 2 percentage points.

Most chains are choosing not to pass the full burden to diners. They are cutting back on discounts, buying more efficiently, changing their menus and staggering smaller price rises instead.

Westlife Foodworld, which operates McDonald’s restaurants in west and south India, reported a 10.1% same-store sales growth (SSSG) in the September quarter, its strongest performance in 13 quarters. Revenue rose 16% year-on-year to ₹747 crore, while guest counts grew in double digits in each month of the quarter. Operating Ebitda increased 29%, with margins expanding 130 basis points to 13.1%.

“Our everyday value platform continues to resonate strongly, helping drive guest growth and frequency,” Westlife president and chief executive Akshay Jatia said on the earnings call.

The company opened 11 restaurants during the quarter, taking its network to 492 across 80 cities, and is targeting more than 580 outlets by March 2028.

Burger King’s deals

Restaurant Brands Asia Ltd, which operates Burger King in India, reported 14% SSSG for the second consecutive quarter. India revenue crossed ₹700 crore, growing 24% year-on-year, while average daily sales stood at ₹1.31 lakh. India company-level Ebitda was ₹55 crore, or 7.8% of revenue. At the consolidated level, revenue rose 20% to ₹844 crore and company-level Ebitda increased 281% to ₹43.2 crore.

Value offers continued to support footfalls. “With 2 for 79, 99 available on app, we've consistently driven this programme over the last couple of years, and this is our 14th consecutive quarter of positive dine-in traffic growth,” said Kapil Grover, group chief marketing officer, Restaurant Brands Asia Ltd, said on the earnings call.

The company also reported a 7% year-on-year increase in frequency among customers using app-only dine-in deals, indicating that promotional offerings are helping encourage repeat visits.

KFC's recovery was similarly supported by dine-in initiatives and entry-level offers. Devyani International Ltd, which operates KFC and Pizza Hut in India, reported revenue of ₹1,519 crore, up 10.4% year-on-year. KFC posted SSSG of 4.4%, while Pizza Hut's SSSG remained negative at 1.4%, although it improved sequentially.

“One is this whole initiative that we have taken on dine-in on a selective basis. That is bringing the consumers back, and it is working,” Devyani president and group chief executive Manish Dawar said at the company’s earnings call.

He said that the ₹99 price point and a ₹149 offer being rolled out were helping attract customers, alongside the brand's Wednesday promotions. Devyani's total network stood at 2,325 restaurants globally by September, and it expects to add 200-220 net stores in FY27.

Costs bite

While affordability initiatives are helping to boost demand, rising operating expenses remain a concern for restaurant operators, many of whom are reluctant to pass on the full cost increase to consumers.

Westlife said it absorbed more than 190 basis points of inflation across commodities, utilities and employee costs. On the earnings call, managing director Saurabh Kalra said the company had reduced discounting while strengthening its value platform.

The company typically takes price increases of 3-4% per year, but has not taken any significant increases so far this year.

Devyani International is also facing higher costs for chicken, edible oils, packaging, utilities and labour. Dawar said gas prices had nearly doubled from a year earlier, while minimum-wage increases in some states had added to expenses.

The company has implemented only small price increases so far, choosing to stagger further hikes due to weak consumer sentiment.

Domino’s Pizza

Jubilant FoodWorks Ltd, the master franchise operator for Domino’s Pizza in India, reported an 11.8% year-on-year increase in consolidated revenue from operations to ₹2,608 crore in the September quarter. Net profit fell 42.7% to ₹111.6 crore, while profit from continuing operations remained broadly flat at ₹113.9 crore.

Domino's India reported like-for-like (LFL) growth of 4.1%, up from 2.5% in the June quarter. Its Popeyes business posted 53% LFL growth, with revenue rising 122%.

Jubilant added 108 stores across its businesses in the September quarter, taking its global network to 3,820. Domino's India added 88 outlets and expanded to 587 cities, including 47 new cities.

Costs are still biting. In its shareholder letter, Jubilant said dearer cooking gas (LPG), higher minimum wages and costlier raw materials hurt its profit and loss account by about 2 percentage points. Instead of raising prices across the board, the company is buying more cleverly, pricing selectively, adjusting its menus and handing out fewer discounts.

The promoters of HT Media Ltd, which publishes Mint, and Jubilant Foodworks are closely related. There are, however, no promoter cross-holdings.

About the Author

Vaeshnavi reports on the business of consumption from Bengaluru, tracking how India shops, eats, and clicks. As a correspondent with Mint’s consumer economy team, she covers sectors ranging from retail and food and beverage to the rapid rise of quick commerce. She is a 2025 graduate of the Asian College of Journalism’s Bloomberg Business and Finance programme. She joined the Mint newsroom in May 2025 and this is her first stint in journalism. She holds a bachelor's degree in accounting and finance from the University of Madras. Vaeshnavi loves storytelling and breaking down complex jargon and numbers to bring out insightful yet simple-to-understand narratives. She is a Malayali but has spent most of her life living in Chennai. During her school days, she was an avid debater and loved participating in anything that involved holding a mic and standing on stage talking to a room filled with people. A diehard SRK fan, she can be found vibing to Indie music and Bollywood songs in her free time. She is a self-confessed cold coffee addict who won’t let a day pass without one, and is always café-hopping in search of the city’s best brew.