Speciality Restaurants Limited , a prominent player in India's restaurant industry, has announced the establishment of a new fully-owned subsidiary in Dubai and reported positive financial results for the second quarter.

Expansion into Dubai

The company has formed Speciality Restaurants L.L.C-FZ, a new wholly-owned subsidiary in Dubai, United Arab Emirates. This strategic move, aimed at investment purposes, involved an acquisition cost of AED 100,000 (approximately INR 22.50 lakhs). The expansion marks Speciality Restaurants' entry into the UAE market, potentially opening new avenues for growth in the Middle East region.

Q2 Financial Highlights

Specialty Restaurants has reported a strong performance for the second quarter:

• The company has maintained profitability for the 17th consecutive quarter.
• Same-store sales growth (SSSG) improved to 1.39% compared to -1.31% in the previous quarter.
• Gross margins increased to 70.40% from 69.30% year-on-year.
• EBITDA margins on an operational basis improved to 7.10% from 6.20%, excluding treasury income.

Key Operational Insights

• The delivery segment continues to contribute significantly, accounting for about 25% of the company's revenues.
• Spends on aggregator platforms remain steady at around 5% of revenues.
• The company is focusing on improving weekday dine-in business to enhance overall performance.

Expansion and Brand Strategy

Speciality Restaurants is pursuing a focused expansion strategy:

• The company opened Asia Kitchen Mainland China in Chandigarh's Elante Mall in October.
• A new brand, Siciliana, focusing on Italian and Mediterranean cuisine, is being expanded across the country.
• The management is prioritizing growth in the Asian cuisine segment, with Asia Kitchen by Mainland China as the primary expansion brand.
• Other focus areas include the Italian brand Siciliana, the QSR format Sweet Bengal, and Walter's Burger.

Financial Position

As of September, Speciality Restaurants reported a cash position of INR 157.42 crores, invested in mutual funds and INVITs.

Future Outlook

The company aims to open 8-10 new restaurants in the next 12 months, focusing on premises within the range of 2,500 to 3,000 square feet of carpet area. The management expects each new restaurant to generate annual revenues between INR 6-7 crores, with an initial CAPEX of approximately INR 4 crores per outlet.

Rajesh Kumar Mohta, CFO of Speciality Restaurants, expressed optimism about the upcoming quarter, stating, "October, November, December is one particular quarter which is the best of the quarters, and we see this as an opportunity for further growth."

As Speciality Restaurants continues to navigate the competitive landscape of the F&B industry, its strategic focus on core brands and expansion into new markets positions it for potential growth in the coming years.

Speciality Restaurants Limited , a leading player in the Indian restaurant industry, has reported encouraging results for the second quarter of fiscal year 2026, demonstrating resilience in a challenging market environment. The company's strategic focus on Asian cuisine and selective brand expansion has contributed to its positive performance.

Financial Highlights

• Profitability streak continues for the 17th consecutive quarter
• Same-store sales growth (SSSG) improved to 1.39% compared to -1.31% in the previous quarter
• Gross margins increased to 70.4% from 69.3% year-on-year
• EBITDA margins on operational basis improved to 7.1% from 6.2% (excluding treasury income)

Strategic Focus on Asian Cuisine

Avik Chatterjee, Whole-Time Director of Speciality Restaurants, emphasized the company's strategic direction: "We have made sure that we will only be expanding into the Asian segment as our primary goal." The company is concentrating on expanding its 'Asia Kitchen by Mainland China' brand in high streets and malls.

Brand Consolidation and Expansion

The company is consolidating its brand portfolio and focusing on key growth drivers:

1. Asia Kitchen by Mainland China (Asian cuisine)
2. Siciliana (Italian and Mediterranean cuisine)
3. Sweet Bengal (QSR format)
4. Walter's Burger (QSR format)
5. Gong (Modern Asian format with wet-led component)

Cloud Kitchen Strategy

Speciality Restaurants currently operates 11 cloud kitchens. However, the company is shifting its focus to a 'kitchen-within-kitchen' format to better utilize existing assets. Avik Chatterjee stated, "We would be having dark or cloud or kitchen-within-kitchens from every single restaurant that we open in the future."

Expansion Plans

Rajesh Kumar Mohta, Executive Director, Finance and CFO, outlined the company's expansion strategy: "We are envisaging that going forward, we should be opening between 8 to 10 restaurants in a 12-month period." The company is targeting smaller format restaurants with carpet areas ranging from 2,500 to 3,000 square feet, a reduction from their earlier formats of 3,500 to 5,000 square feet.

Financial Position

As of September 2025, Speciality Restaurants reported a strong cash position of 157.42 crores, invested in mutual funds and INVITs.

Outlook

While the company faces challenges such as weekday dine-in pressure and the need for skilled manpower, management remains optimistic about growth prospects. The focus on core brands, particularly in the Asian cuisine segment, and the strategic expansion of formats like Siciliana and Gong are expected to drive future growth.

Speciality Restaurants' ability to adapt to changing market dynamics, focus on profitable segments, and maintain a strong financial position positions it well for continued success in the competitive restaurant industry.