Devyani International Limited Devyani International has moved to align employee incentives with long-term value creation by approving a significant grant of stock options. The Nomination and Remuneration Committee (NRC) of the Board authorized the issuance of 27,13,700 stock options to eligible employees under the Employees Stock Option Scheme 2021 (ESOP 2021) during its meeting held on July 29, 2026. This grant serves as a retention and motivation tool for the workforce driving the operations of its KFC, Pizza Hut, Costa Coffee, and other brand portfolios.

The approval was made pursuant to Regulation 30 read with Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Detailed disclosures were filed in accordance with SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/1/3762/2026 dated January 30, 2026. The company uploaded the relevant details on its website, www.dil-rjcorp.com , and communicated the filing to both the National Stock Exchange of India Ltd. and BSE Limited.

Key Terms of the Grant

The structure of the ESOP grant is designed to provide flexibility while ensuring long-term commitment from employees. Each stock option is convertible into one fully paid-up equity share of the company, which has a face value of Re. 1/- each. Consequently, 27,13,700 equity shares are covered by this specific grant.

The exercise price of Rs. 101 was determined by the NRC. While the specific vesting schedule for individual employees is outlined in their respective Grant Letters, the scheme mandates a minimum period of one year between the date of grant and the date of vesting. Once vested, employees may exercise these options within a five-year window. Notably, there is no lock-in period imposed on the equity shares acquired through the exercise of these options, allowing holders to trade them immediately after allotment.

What the Numbers Show

The decision to grant over 27 lakh options at a fixed price of Rs. 101 reflects the board’s confidence in the future growth trajectory of the company. By setting a clear exercise price, the company provides employees with a tangible benchmark for value creation; any appreciation in the share price above Rs. 101 directly translates into financial gain for the option holders. The absence of a lock-in period on the resulting shares offers liquidity flexibility, distinguishing this grant from more restrictive equity plans. This approach balances immediate liquidity potential for employees with the long-term alignment enforced by the mandatory one-year minimum vesting period.

Devyani International Limited delivered its highest-ever quarterly EBITDA of ₹255 crore in Q1FY27, expanding margins to 16.1% as consolidated revenues surged 16.5% year-on-year to ₹15,805 million. The quick service restaurant operator posted a profit after tax of ₹171 million, marking the highest figure in eight quarters, while pre-tax profit reached ₹229 million, representing more than a six-fold increase compared to the previous year. This performance underscores the company’s ability to drive profitable growth despite operational headwinds such as LPG cost inflation and wage hikes.

The results were filed under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with the National Stock Exchange of India Ltd. and BSE Limited on July 29, 2026. The filing highlights broad-based operational improvements, with positive same-store sales growth (SSSG) recorded across all major brands in the portfolio. Management attributed the strong start to FY27 to the momentum built in the second half of FY26, anchored by robust demand for key offerings.

Financial Performance Highlights

The company’s financial metrics for the quarter ended June 30, 2026, reflect significant top-line and bottom-line strength:

Brand-Wide Sales Growth

Devyani International reported positive SSSG across its diverse brand portfolio, indicating resilient consumer demand. KFC, the largest contributor, delivered an SSSG of 3.3%, continuing its trajectory of double-digit sales growth. Other international and homegrown brands also performed strongly:

• Costa Coffee: Recorded an SSSG of 10.2%.
• Biryani by Kilo (BBK): Achieved an SSSG of 7.2%.
• Vaango!: Delivered an SSSG of 7.1%.
• Pizza Hut: Showed sequentially better SSSG numbers.

Ravi Jaipuria, Non-Executive Chairman, noted that the business has improved profitability despite volatile operating environments and seasonal complexities. He highlighted that the forecast of a below-normal monsoon season and El Niño risks serve as reminders that consumption recovery in India is not linear, yet the company remains on track to meet its store expansion targets for FY27 with a current network of 2,255 outlets.

Strategic Developments

The merger process with Sapphire Foods India Limited continues to progress according to expected timelines. Devyani International received approvals from both the NSE and BSE in June 2026, advancing the regulatory filings required for the next phase. The company aims to complete the merger by the end of FY27. Additionally, management emphasized the successful integration of new leadership under Manish Dawar, describing early cultural and operational shifts as part of the "DIL 2.0" initiative.

What the Numbers Show

The divergence between the 16.5% revenue growth and the 38% increase in operating EBITDA indicates significant operating leverage. With the brand contribution margin improving by 1.1% year-on-year, the company is effectively managing input cost inflation, particularly regarding LPG and wages. This margin expansion suggests that volume growth is translating into disproportionate profit gains, reinforcing the scalability of its franchise model even amidst macroeconomic uncertainties.

Source: https://lodr-files.dhan.co/lodr-inputs/Company/INE872J01023/83497611-74cd-4035-87cf-4faad1e507ca.pdf