Burger King India Reports Narrower Quarterly Loss as Outlet, Menu Expansion Continues

Restaurant Brands Asia, the franchisee of Burger King India, narrowed its net loss to 460.3 million rupees in the quarter ending Sept. 30, from 499.5 million rupees a year earlier. The performance was attributed to expanding its outlets and menu.

Despite shifting operations amid the ongoing pandemic, the revenue from operations rose 16% to 6.25 billion rupees, as per Reuters.

Menu Expansion, Increased Outlet Presence

Business Standard reported that analysts have attributed this improvement to Burger King India's strategic move to expand its menu during the quarter, with a focus on chicken items. In addition, promotions on select meals have increased footfall at their restaurants, resulting in higher average bill values.

Restaurant Brands capitalized on the growing mall culture in India, which helped it dominate the fast food market. The addition of 10 new Burger King outlets further amplified its outreach. However, same-store sales growth decreased to 3.5% as compared to 27% in the previous year, signaling the need for further customer retention strategies.

Rising Expenses and Cost Management

The company experienced a 15% increase in expenses primarily attributed to the rising cost of ingredients, which surged by over 20%. To mitigate the impact, several fast food chains, including Burger King, had to trim down their menus, removing items like tomatoes and cheese to cut back spending during the quarter.

Quarterly profit declines were also reported by rival fast food chain operators such as KFC operator Devyani International, Pizza Hut operator Sapphire Foods India, McDonald's operator Westlife Foodworld, and Domino's India franchisee Jubilant FoodWorks.

This downturn in their performance contrasts with the positive trajectory of Restaurant Brands Asia and Burger King India.

The news of a downturn resulted in a momentary dip of 2.1% in the shares of Restaurant Brands; however, they quickly reversed course and rose by 3.3%. Year-to-date, shares have witnessed a commendable 6.5% increase. Devyani and Westlife have each witnessed a rise of 2% and 3%, respectively, while Sapphire and Jubilant have faced a decline of 4% and 0.5%.

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