Devyani International Limited has informed stock exchanges about a significant income tax demand received by its wholly-owned subsidiary Sky Gate Hospitality Private Limited. The disclosure was made on March 25, 2026, pursuant to Regulation 30 of the SEBI Listing Obligations and Disclosure Requirements Regulations, 2015.

Income Tax Demand Details

Sky Gate Hospitality Private Limited received a demand order from the Assessment Unit of the Income Tax Department under section 143(3) of the Income-tax Act, 1961. The order pertains to Assessment Year 2024-25 and involves alleged excess premium on issuance of shares during financial year 2023-24.

Nature of Alleged Violation

The demand order specifically addresses the alleged excess premium on issuance of shares by Sky Gate Hospitality during the financial year 2023-24. This relates to the company's share premium accounting and valuation practices during that period.

Company's Response and Impact Assessment

Devyani International has clarified that there is no material impact on the financial, operational or other activities of the company due to this order. The subsidiary Sky Gate Hospitality is currently in the process of evaluating the demand order comprehensively.

The company plans to take necessary steps available under applicable law to respond to the demand, including:

• Detailed evaluation of the demand order
• Filing of appeal with the Appellate Authority if required
• Engaging with relevant legal and tax advisors

Regulatory Compliance

The disclosure was made in compliance with SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026. Chief Sustainability Officer & Company Secretary Pankaj Virmani signed the disclosure on behalf of Devyani International Limited.

The company has requested both National Stock Exchange of India Limited and BSE Limited to take this information on record as part of its ongoing regulatory obligations.

Devyani International has received board approval for a comprehensive investment and financing structure totaling THB 1,210 Mn (INR 3,473 Mn) in its Thailand subsidiary Restaurants Development Co., Ltd. (RD). The Investment and Borrowing Committee, based on recommendations from the Audit, Risk Management & Ethics Committee, approved this strategic initiative on March 10, 2026.

Investment Structure and Details

The approved investment involves a multi-layered funding approach through the company's subsidiaries. Devyani International DMCC (DID) and Yellow Palm Co., Ltd. (Yellow) will jointly invest in RD to strengthen its balance sheet and fund long-term business requirements.

Funding Mechanism and Corporate Guarantee

To facilitate this investment, DID will raise THB 400 Mn (INR 1,148 Mn) through a convertible loan from Devyani International at 8.30% per annum. Additionally, DID will secure a short-term loan of THB 810 Mn (INR 2,325 Mn) from Axis Bank Limited, Dubai, which will be backed by a corporate guarantee from the parent company.

Target Company Profile

Restaurants Development Co., Ltd. operates a chain of 274 KFC restaurants in Thailand as of September 2023. The company has demonstrated consistent growth with a turnover of THB 6.13 billion for FY 2025, compared to THB 6.07 billion in CY 2024 and THB 5.67 billion in CY 2023.

Strategic Impact and Ownership Structure

The investment will be utilized in two primary areas: THB 810 Mn will retire existing DID debt, while the remaining funds will support RD's working capital and capital expenditure requirements. Post-investment, DID will hold a 49.00% stake in RD, while Yellow will maintain 51.00% ownership.

The corporate guarantee provided to Axis Bank Limited, Dubai will be treated as a contingent liability in the company's books of account, with the conversion rate applied at 1 Thai Baht (THB) = INR 2.87.