Devyani International Limited has released its Annual Report for the financial year ended March 31, 2026, highlighting a period of strategic transformation, disciplined network expansion, and a landmark merger announcement. The company, one of India's largest Quick Service Restaurant (QSR) operators and the largest franchisee of Yum! Brands in India, reported consolidated Revenue from Operations of ₹ 56,115 Million, representing a 13.3% year-on-year growth, supported by strong performance across core brands, continued store expansion, and increasing contribution from international markets.

Financial Performance Overview

The company's financial results for FY 2025-26 reflect both the scale of its operations and the impact of near-term demand softness in certain markets. The following table summarises key consolidated financial metrics:

The Board of Directors did not recommend any dividend on equity shares for FY 2025-26 in view of losses at the standalone level.

Store Network Expansion

As of March 31, 2026, Devyani International operated 2,256 stores globally, compared with 2,039 stores a year earlier, reflecting a net addition of 217 stores during the year. The store footprint across brands and geographies is detailed below:

KFC remained the primary engine of expansion, with 87 net new stores added in India and a further 22 KFC stores added in international markets during FY 2025-26. KFC's network comprised 1,169 restaurants across four countries as of March 31, 2026.

Brand Performance: KFC and Pizza Hut

For KFC India, Revenue from Operations stood at ₹ 23,737 Million, up 8.9% from FY 2024-25. Gross Margin at 68.6% was stable. Same-store sales growth (SSSG) for the year was marginally negative at -0.8%, leading to a lower Average Daily Sales (ADS) of ₹ 9,00,000. Brand contribution margin at 15.8% was suppressed due to deleverage from lower ADS, higher delivery costs, and an increase in rental costs. However, exit Q4 SSSG recovered to 4.9%, described as the highest in the last 14 quarters.

Pizza Hut reported Revenue from Operations at ₹ 7,206 Million. Gross Profit stood at ₹ 5,436 Million with Gross Margins at 75.4%, a decline from 76.3% in FY 2024-25. SSSG for FY 2025-26 was at -5.3%, with ADS declining to ₹ 32,000. The company adopted a cautious approach to Pizza Hut store expansion, operating 639 Pizza Hut restaurants in India as of March 31, 2026, in line with its consolidation strategy.

International Business

The international division delivered consistent growth in FY 2025-26, led by Thailand. International division revenues came in at ₹ 18,594 Million, representing 13.8% year-on-year growth. Gross margin improved to 64.9%. Brand Contribution grew to ₹ 3,173 Million, with Brand Contribution margins expanding to 17.1%. Nepal recorded an impressive 23% year-on-year increase in sales during the year, while Nigeria continued operations across major cities including Lagos, Abuja, and Port Harcourt.

Transformational Merger with Sapphire Foods

The most significant development during FY 2025-26 was the announcement of a proposed merger with Sapphire Foods India Limited. The Board of Directors approved the Scheme of Arrangement on January 1, 2026, with an Appointed Date of April 1, 2026. Under the Scheme, Devyani International will issue 177 fully paid-up equity shares of ₹ 1/- each for every 100 fully paid-up equity shares of ₹ 2/- each held by shareholders of Sapphire Foods India Limited. The merger is subject to requisite regulatory approvals.

Key details of the proposed merger are summarised below:

The merger is expected to consolidate KFC and Pizza Hut operations in India, creating one of Yum!'s largest franchise partners globally and one of the top QSR operators in India.

Sky Gate Hospitality Acquisition and Own Brands

During the year, Devyani International acquired Sky Gate Hospitality Private Limited, which owns brands including Biryani By Kilo (BBK) and Goila Butter Chicken (GBC). The acquisition was completed on June 10, 2025, with the company acquiring an 80.72% equity stake on a fully diluted basis for an aggregate consideration of approximately ₹ 4,196 Million, discharged through a preferential issue of equity shares. Sky Gate subsequently became a wholly-owned subsidiary of the company with effect from March 7, 2026. Both BBK and GBC achieved brand-level operational break-even ahead of schedule. The Own Brands segment expanded from 96 stores as of March 31, 2025 to 217 stores as of March 31, 2026.

Corporate Social Responsibility and Human Resources

In FY 2025-26, Devyani International spent ₹ 17.71 Million towards skill development under the National Apprenticeship Promotion Scheme (NAPS), supporting a total of 528 apprentices, which constituted its entire CSR obligation for the year. As of March 31, 2026, the company employed 15,955 partners on a standalone basis, including 255 specially abled partners. Female partners constituted 30.5% of the employee base, and the company operated 229 women-managed restaurants. The company invested ₹ 6.20 crore towards employee well-being during FY 2025-26.

Leadership and Governance

Effective April 1, 2026, Mr. Manish Dawar was elevated as Whole-time Director (President & Group CEO), succeeding Mr. Virag Joshi who superannuated as Whole-time Director and continues as a Non-Executive Director. Mr. Anupam Kumar was appointed as Chief Financial Officer with effect from April 1, 2026. The Board comprised 10 Directors as of March 31, 2026, including 5 Independent Directors. The company's 35th Annual General Meeting is scheduled for Friday, August 14, 2026 at 11:00 A.M. (IST) through Video Conferencing / Other Audio-Visual Means facility.

Devyani International Limited will host a conference call with investors and analysts on July 29, 2026, to discuss its financial results for the period ended June 30, 2026. The call is scheduled to begin at 2:30 PM IST, providing a platform for the company's senior management to address the quarterly performance and recent developments. The results for the first quarter of FY27 will be announced earlier on the same day.

The disclosure was made pursuant to Regulation 30(6) read with Part A of Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company operates a network of over 2,200 stores across more than 350 cities in India, Thailand, Nigeria, and Nepal. It holds the distinction of being the largest franchisee of Yum! Brands in India and Nepal.

Conference Call Details

The company has outlined specific logistics for the event to facilitate smooth access for participants. Investors can pre-register to connect directly without waiting for an operator.

Brand Portfolio and Operations

Devyani International's portfolio includes a mix of global brands and homegrown concepts. It is the sole franchisee in India for international brands such as Costa Coffee, New York Fries, and Sanook Kitchen. The company has also developed indigenous brands like Vaango, a South Indian vegetarian cuisine concept, and The Food Street, a multi-brand food court format.

Additionally, the company has expanded its Indian cuisine offerings through the acquisition of Sky Gate Hospitality, which owns popular brands such as Biryani By Kilo and Goila Butter Chicken. The company's website, www.dil-rjcorp.com , will host further details regarding the call.