United Foodbrands Limited received an Assessment Order and Notice of Demand from the Deputy Commissioner of Income Tax, Bengaluru, on May 31, 2026, for the Assessment Year 2023-24. The order follows an assessment under Section 143(3) read with Section 144C(3) of the Income Tax Act, 1961. The authority has made an addition of ₹2.78 crores to the company's total income, resulting in a total demand for income tax and interest aggregating to ₹8.63 Crores.

Material Details of the Order

The addition to income arises from a transfer pricing adjustment made under Section 92CA(3) regarding the determination of Arm's Length Price. This adjustment pertains to royalty received from Associated Enterprises (AEs). The company stated that the Assessing Officer issued the demand without providing credit for carry forward losses amounting to ₹28.30 crores.

Company Response and Financial Implications

United Foodbrands Limited maintains that it is not liable to pay the demanded income tax and interest. The company is currently in the process of filing an appeal against the addition to income made pursuant to the transfer pricing adjustment. Additionally, the company has submitted an application for the rectification of the order and the demand notice. No penalty or restriction has been imposed pursuant to the communication.

United Foodbrands Limited reported a consolidated net loss of ₹619.11 million for the fiscal year ended March 31, 2026, compared to a net loss of ₹270.36 million in the previous year. Revenue from operations for the year increased to ₹13,387.02 million from ₹12,330.49 million in FY25, reflecting an 8.6% year-on-year growth led by robust transaction growth in the second half of the fiscal year. The board approved the financial results at its meeting held on May 19, 2026. A corporate presentation for May 2026 was subsequently filed on May 28, 2026, under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Consolidated Financial Performance

The following table outlines the key consolidated financial metrics for the year ended March 31, 2026 (all figures in ₹ million):

For the quarter ended March 31, 2026, the company recorded a consolidated net loss of ₹134 million, narrowing from a net loss of ₹202 million in the same quarter of the previous year. Revenue from operations for the quarter stood at ₹3,603.96 million.

Q4 FY26 Operational Highlights

The earnings presentation highlighted robust operating performance in Q4 FY26, driven by strong volume growth across segments. The company's restaurant network expanded to 262 outlets after adding 35 new restaurants in FY26, with Q4 marking the highest ever quarterly new restaurant openings. The following table summarises key Q4 FY26 metrics on a year-on-year basis:

Dine-in revenue growth accelerated to 21.6% in Q4 FY26 from 14.7% in Q3 FY26, driven by the 43.4% year-on-year dine-in volume growth. Delivery revenue also reached its highest ever quarterly level, with strong growth recorded across all brands. While EBITDA grew marginally year-on-year to ₹575 million from ₹567 million, the EBITDA margin contracted to 15.9% from 19.4% in the same quarter of the previous year.

Segment-Wise Performance

All three business segments delivered strong year-on-year growth in Q4 FY26. The following table presents the segment-wise performance breakdown:

The International segment reported revenue growth of 27.5% in Q4 FY26, supported by network expansion and SSSG, while maintaining a pre-IND AS restaurant operating margin of 24.4%. Gross profit for the International segment grew 20.1% year-on-year, though gross margin was partially impacted by higher inflation amid the West Asia crisis. Matured restaurants delivered strong annualised revenues of ₹62 million per restaurant with 14.4% operating margins, compared to 13.8% in Q4 FY25.

Annual Performance and Network Expansion

For the full year FY26, consolidated SSSG rebounded to +4.7%, with gross profit increasing 5.7% year-on-year. The company reported a pre-IND AS restaurant operating margin of approximately 12.2%, driven by higher margins in the second half. H2 FY26 saw robust momentum with 18.5% revenue growth, 14.3% gross profit growth, and 14.6% growth in restaurant operating profit, driven by a sharp volume-led recovery. The Barbeque Nation India segment added net 16 restaurants versus net 5 in FY25, with revenue growing 4.6% year-on-year and H2 SSSG recovery to +4.4%.

FY27 Outlook and Expansion Roadmap

Management has expressed strong confidence in the company's growth trajectory, projecting 22-25% revenue growth for FY27 and planning to open 40 new stores during the year. The following table summarises the company's expansion roadmap:

United Foodbrands noted that 11 restaurants are currently under construction and are expected to be operational in Q1/Q2 FY27, providing a strong foundation for achieving the near-term network target of 300+ restaurants by FY27.