Devyani International Limited (DEVYANI) Q3 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Divyani International Learnings Conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star and then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anup Pujari from CDR India. Thank you, and over to you, sir.

Thank you. Good afternoon, everyone, and thank you for joining us on Debyani International's Q3 and 9M FY26 earnings conference call. We have with us Mr. Ravi Jaipuriya, non-executive chairman of the company, Mr. Raj Gandhi, non-executive director, Mr. Viram Jushi, CEO and whole-time director, And Mr. Manish Dharvar, CFO and Holtan Director of the company. We will initiate the call with opening remarks from the Chairman, followed by key financial highlights from the CFO. Thereafter, we will have the forum open for a question and answer session. Before we begin, I would like to point out that some statements made in today's call may be forward-looking in nature, and a disclaimer to this effect has been included in the results presentation shared with you earlier. I would now request Mr. Ravijai Pudya to make his opening remarks.

Good afternoon, everyone, and thank you for joining us today. It's my pleasure to welcome you all to Devyani International's Post Results Earnings Conference call to discuss our performance for the third quarter, 25-26. We continue to invest in and steadily expand our core business in India. New store openings accelerated during the quarter with 54 net new KFC outlets and 18 net additions to Pizza Hut. With this, we have not added any net new Pizza Hut stores on a cumulative basis during the calendar year 2025. Within our brand, Biryani by Kilo and Vango, the international business added 20 new stores during the quarter between Thailand and Nepal after 3, 2026. We are happy to state that we have achieved break-even brand EBITDA results by Biryani by Kilo much ahead of our target as guided earlier. In parallel, we are also bringing innovative new products. We recently introduced the Dunked Range in KFC and Fairy Barbecue Sauce. The product launch has been accompanied by a promotional campaign focusing on the indulgence and craving features, a well-known comedian and actor well-received. We also have launched the corporations grew 12.1% year-on-year, while consolidated revenues reached 3% year-on-year. We announced the proposed merger with Sapphire Foods, a transformative step that will create one of the largest diversified F&B platforms in India. The combined entity will have more than 3,000 stores globally and a turnover approaching USD 1 billion. We are very excited regarding this new chapter in your company's growth phase. We've also started the process of turnaround of the Pizza Hut business by shutting down loss-making stores for the new openings in January and back in post-merger geographies in the world, and I feel the expanded DIL to greater heights.

Thank you, Mr. Jaipuriya. Good evening, everyone. A very warm welcome, and thank you for your valuable time for attending DIL's quarter 3 FI 26 earnings conference call, our 18th such call since our listing in August 21. At the outset, I would like to thank the Chairman and the Board for reposing the trust and confidence in me to lead DIL at such an exciting and transformative juncture. With DIL's deep operational capabilities, strong brands, expanding scale, and growing digital and technology backbone, we are uniquely positioned to build a future-ready QSI platform that delivers sustained and long-term value for our stakeholders. We will be announcing the broader leadership team for DIL in due course as we progress with the merger. Coming back to the results, as of December 21st, 2025, our total network stood at 2279 stores, comprising of 1174 KFC stores and 648 Pizza Hut stores. We also launched our first Sanu Kitchen outlet in Gurgaon. Sanu Kitchen brand is for Thai and Asian food lovers. The consolidated operating EBITDA for Q3FI26 was Rs.1441 crores, up 11.3% Y on Y. Consolidated Q3FI26 gross profit came in at Rs.993 crores, up 11.7% Y on Y, with margins at 68.9%, reflecting an improvement of 20 basis points Y on Y. Excluding Skygate, the improvement is 70 basis points Y-on-Y and 110 basis points versus quarter to F526. Consolidated brand contribution was higher at Rs. 200 close versus Rs. 185 close last year, led by our India and international operations. The brand contribution margin improved to 13.9% versus 11.7% in the previous quarter. I am happy to report that Skygate brands posted a break-even brand EBITDA. This is ahead of our initial expectations and guidance given earlier. Consolidated operating EBITDA on a pre-index basis was Rs. 124 crores with margins at 8.6% versus 6.8% in the previous quarter. Reported EBITDA was Rs. 227 crores with margins at 15.7%. Indian operations grew 12.1% Y-on-Y to reach Rs. 978 crores in revenues. Gross margin came in at 71%, culturally flattish on Y-on-Y basis. Excluding Skygate, the GM improvement stands at 60 basis points versus the previous year. KFC in India added 54 net new stores in Q3 FY26, taking the total store count for KFC in India to 788 stores as of 31st December. Average daily sales for Q3 FY26 was stable, sequentially at Rs. 90,000. Revenues at Rs. 603 crores were up 5.9% Y-on-Y. Gross margin at 69.8% showed 1.2% improvement compared to the same quarter last year. The improvement in gross margin was offset on account of deleverage impact because of lower ADS and higher delivery revenues. Brand contribution margin was Rs. 101 crores with margins at 16.8%, 40 basis points lower versus the previous year. We opened 18 next new Pizza Hut stores in quarter 3 FY26, ending with 639 stores in India. Pizza Hut India revenue for the quarter was 178 crores with ADS at 31,000 rupees. Gross margin was at 76% and improvement of 1.2% from the preceding quarter. Despite deliverage on lower sales, we managed to effectively control costs and delivered positive brand contribution of Rs. 1.4 crores and margins at 0.8% for the quarter, improvement of 1% from the previous quarter. We also started to shut the loss-making stores. We have taken steps to turn around the Pizza Hut business. We will start to shut down the loss-making stores in the Pizza Hut portfolio, and our plan is not to add any net new units in the brand for 2026. However, we will ensure that the overall store count remains broadly in line with December 25 numbers. Franchise brands, which include Costa Coffee and the newer brands in India posted revenues of Rs. 56 crores, with wire-on-wire stable gross margins at 75.7%, and brand contribution of Rs. 8.8 crores, with margins at 15.7%, improvement of 5.2% versus the preceding quarters. Our own brand's portfolio, which includes Vango, Biryani by Kilo, and Goyla Butter Chicken, recorded a healthy growth with Rs.94 in revenues and gross margins at 64.2%. Brand contribution margin came in at 9%, reflecting the turnaround in the profitability of SkyGate portfolio. We achieved break-even brand beta for SkyGate in the month of December. The SkyGate portfolio continues to perform in line with our expectations with the growth momentum carrying through quarter three. With margins improving and the integration nearly completed, we have started to scale up the brand in a measured manner. This quarter, we added 13 net new stores under the SkyGate portfolio in DIL's existing food court locations. I am happy to report that Vango has crossed a count of 100 stores in this quarter. The revenues for the quarter came in at Rs. 20 crores, and the brand continues to maintain its healthy gross margins and the brand contribution. Our international business continues to demonstrate resilience and strong performance. Revenues reached Rs. 473 crores in Q3 FY26, up 10.1% Y&Y, with improved gross margins at 64.9%. 9%. Brand contribution of Rs. 81 crore, representing 17.1 margins, is higher on YN1 basis. Let me also take this opportunity to briefly update you on the merger process. We have already submitted our applications for exchange approvals, and we will also be shortly filing the application for CCI approval. At this point, we do not anticipate any material deviation in the merger timeline that we have outlined earlier. While we continue to execute towards The proposed merger will further help us build a strong growth foundation in India, and the estimated annual merger synergies of approximately Rs. 210 to Rs. 225 crores will allow us a greater headroom to invest in India and grow the business. In our view, QSR remains one of the most promising segments in the consumption category, and we believe we have the brands and the management capability to build a market-leading business. On that note, I would like to request the moderator to open the forum for any questions or suggestions that you may have. Thank you very much.

Thank you very much.

We will now begin the question-and-answer session.

Anyone who wishes to ask a question may press star and 1 on their touch-tone telephone. If you wish to remove yourself from the question view, you may press star. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question view assembles. Our first question comes from the line of Devanshu Bansal from M.K. Global. Please go ahead.

Hi, thanks for the opportunity and congratulations on our good opportunity. At the onset, Viraz, kudos to your long career in Lejani, and education, discipline, and healthy operations.

Devanshu, your voice is not really clear. Hi, Devanshu.

Yeah, is it better now?

Hello. Yes, better now.

Yeah, is it better now? Yeah, I was saying, Ghirag, kudos to your career and execution on healthy operational savings despite a prolonged macro weakness. And Manish, congratulations and all the best for your new role as CEO of the merged entity. Just Manish, starting off, still there is some time for the CEO hat, but you have been in the system for quite some time. Checking if If you would like to share some initial thoughts on your key focus areas for ramping up the next phase of the growth journey for Dejan.

So I think, Devanshu, obviously it is too early to kind of comment on this piece. And as you said, I've been in the system long enough, and therefore we all know, and this is not hidden, our biggest priority will be to turn around the SSSG and ADS numbers. And this can only happen with multiple measures, and obviously we have to bring a completely enabling environment so that we are able to take these actions forward. So we will come back to you in due course of time in terms of what the new leadership team will be, what will be our strategy, and so on and so forth. But otherwise, the operational priority remains very, very important. We have to be ready with the leadership team before we get into a merger consummation scenario. We need to have a strong technology focus because we all recognize that Divyani is lagging behind on technology versus some of the other peer group. So these are the top priorities that I would say, but we will come back to you as and when things evolve.

No, fair enough, Manish. Looking forward to the updated strategy. The second question, obviously, the commentary mentions that most formats have seen positive SSG in Jan 26. I wanted to understand the key initiatives which have led to this improvement, just to better gauge the sustainability of this SSG turnaround.

We experimented Devanshu with some ideas on the promotions, on the deals. We've changed a little bit of our strategy in terms of how we deal with the online business and offline business. So that has really kind of helped us with the January SSSG numbers. As Mr. Jaipuria said, that Pizza Hut is still to be kind of done. But again, this is just one month and We've just started doing experiments. We are seeing the results. As I said, in terms of what the sustainable strategy will be, we will come back to you in the course of time.

Sure. Just a small follow-up here. So, how do we see our improved gross margin profile? Whether we have invested back some of the savings at the gross level to revise this SSG or the JAN trends are mostly with the 70% SSG that we have reported in KFC?

Devanshu, broadly, we will be able to maintain the gross margins profile. I mean, it could be here and there by whatever, some basis points. But largely, the gross margin profile will be maintained.

Sure. Thanks for taking my questions, Manish.

Sure. Thanks a lot, Devanshul.

Thank you. Our next question is from the line of Jay Doshi from Kota. Before you go ahead, sir, let me remind participants that they may press star and want to ask a question and to please limit your questions to one per participant. You may rejoin the QWPF follow-up question. Jay Doshi, you may proceed with your question.

Margin or absolute EBITDA adjusted for seasonality, you should be comfortable maintaining and should we expect improvement over the course of coming quarters from this level?

Yeah, we feel so because as I've said in the past, it was the negative, continuous negative SSSG which was kind of pulling us down. And as you know, in the previous quarter, we started consolidating Biryani by Kilo and Biryani by Kilo was a loss-making portfolio and that's where the previous quarter numbers got impacted. So, we've managed to turn around Biryani by kilo to a break-even level, and therefore, that has helped us. Our Nepal-Nigeria operations have done exceedingly well. Thailand is very, very stable. If you look at the losses in SSSG in the KFC business in India, they are better than what we've seen in the past. And therefore, we are hopeful that we should be able to maintain the EBITDA numbers.

Sure. Second question is on KFC, you know, for brand, you know, with such strong brand equity, you know, 10 odd quarters of SSSG decline. You know, can you give us some indication of what could be the impact of cannibalization on SSSG of KFC? And is there any thought internally to perhaps slow down store addition for KFC for a year or so and try and improve SSSG and profitability of that business?

Jay, if you look at our store opening pace, and I'm talking about here KFC as a brand and not DIL so much, if you look at, let's say, in the last five years, we've gone to almost close to three to four times of what the base store count used to be. And obviously, if you are opening stores at that pace, there will be some amount of cannibalization which will seep in. I think what is required to be done on KFC is a very differentiated strategy from an online and offline perspective, a very differentiated strategy from how we treat the brand innovation, again, from an online and offline perspective. And we've started discussing that internally. We've started taking some steps and that's what Mr. Jaipuri alluded that we've seen positive SSG in January month. So the idea is that we need to have the right steps and a strategic direction in terms of how the food sector has evolved after the entry of online players like Zomato and Swiggy. And that is what the focus area is going to be. Because if you look at, for example, I mean, I don't want to name the competition, but the nearest competitor in QSR is sitting at more than twice the store count that we have in KFC. KFC. And therefore, those results are fine. And that is the inspiration for us to ensure that we continue to grow KFC. However, we have to sort things out in terms of the strategy piece, and we will come back to you on those.

Understood. Final question is, you know, you had a certain incentives, you know, linked to store openings per year. Now, in the new agreement that, you know, you may have signed with YUM, do you still have, you know, a similar level of commitment in terms of store additions for KFC? Or has it been relaxed in context of, you know, the weakness that Indian market is seeing?

See, Jair right now, for example, let's say, during the merger discussions, it was more of what are the merger conditions and how will the merger take place and YUM's approval and so on and so forth. Both the companies had independently signed the development agreements. They will continue, and obviously, we will inherit whatever was signed by Sapphire. Having said that, obviously, we will present the complete KFC strategy to the parent organization, which is YUM Brands, And we will have that discussion in terms of what is right for the brand, because for Yum also, India remains a top priority as far as growth is concerned. And Pizza Hut, as you know, we've already mentioned that we've scaled back, and even for 25, there was zero NNUs. 26, again, there are going to be zero NNUs. So therefore, Pizza Hut, we've recognized that, and the focus is turnaround. Whereas KFC is seen as a growth brand. But nonetheless, we take your point, and that is something which is kind of a pending discussion from our side with YAM.

Thank you so much, and Manish, wish you the very best for your new role.

Thank you so much.

Thank you. Our next question comes from the line of Tejas Shah from Aventus Park Institutional Equities. Please go ahead.

Hi, thanks for the opportunity, and Manish, congrats on the promotion. And then, best wishes for the new role. Devansh, you tried asking this, but I'm also pushing my luck here. So, you have had a front seat row to the prolonged struggle that we have seen in the last many quarters. And then, you have multiple unfinished projects on the table today. So, what would you prioritize in the sense, fixing or ramping up KFC first or fixing Pizarre as a model first? And then you have a lot of long tail of other projects as well. So I just wanted to understand without too much detail there.

So Tejas, I think I've discussed this whole scenario multiple times with you guys. See, traditionally, we were operating like a multi-environment business. So there was Yum, there was Sapphire, and there was us. So any decision-making used to happen as a three-way approach by way of consensus. Whereas competition had that advantage of being very nimble-footed, faster decision-making, investing in technology. In our case, it was a fractured environment from a multiple perspective. And I think the biggest strategic move that we have taken is to consolidate the two companies. And as we've discussed in the previous call that we will take over technology operations from Yum, we will take over supply chain management from Yum, now all of these things will come back and help us. And therefore, once we overlay that with the operations piece, I think it's a great win-win combination for us. And that's the reason it was very important that we kind of sort out the larger structural issue, which is where we were hugely hampered and impacted by. And that is what something that we've managed to do, not yet in practice, because we are undergoing the regulatory approvals, which will take some time. And this is the time we'll utilize for strategy building and in terms of what is that we need to do on blast tax while, let's say, the merger process is currently on in terms of approvals.

And second, on this January commentary that we have put out, apart from the SSG, what are the other operational indicators which are actually helping us to or guiding us to see that this could be sustainable and not a false start that we have seen multiple times in the last two, three years?

See, as I mentioned earlier, I'm not saying that, I'm just saying factually that January has been positive, and let's see, it is just one month. I don't want you guys to draw any conclusions based on that. We need to look at how the whole quarter goes. We need to experiment with the initiatives we've taken in other geographies, so it's early, I agree with you, but we just wanted to indicate the factual situation.

Thanks and all the best for the comment. Sure, thank you so much.

Thank you. Our next question comes from the line of Saksha from Old Bridge Capital. Please go ahead.

Hi, team. Thank you for taking my question. Just one on pizza hat. So, we noticed that we started to sort of shut down the lock-in stores, and that is getting compensated as a new addition. I just wanted to get a sense on, you know, what is your initial lead-through? How far do we have to go in terms of shutting these stores down? Like, how many stores? If you can just give us an indication on how many stores, such stores are there, and what could be your initial lead-through on what is not working for us in these stores? Is it categorization or competition or something else? That's the only question I have.

See, we'll have to handle, again, Pizza Hut from multiple fronts. So, one important element is shutting the loss-making stores. The other important element is having technology for the brand, which is where we have been missing. We need to make sure that the marketing is much more effective. We need to make sure that the innovation pipeline is stronger. And as I said, all of these initiatives will transition from YUM to us. Now that is going to take about a year. In the meantime, we've started taking this initiative on cleaning up the loss-making stores. It'll take a couple of years to finally sort it out, but we've absolutely started this exercise. And now, once we have the CCI approval, obviously, between us and Sapphire, we are not in a position to talk to each other at this stage. But once we have the CCI approval, we will sit jointly and route a merged company strategy plan for Pizza Hut, because that is where we need to kind of work together very, very intensively by the time the entire process gets finished. So we will come back to you on that piece once we have more details.

Thank you. The next question comes from the line of Percy from IIFL. Please go ahead.

Hi, Manish. Just one very basic question I wanted to ask you, and this is ignoring any merger synergies that you might get a year or two later, but for FY27, what is the minimum SSSG that you need to deliver so that you can have a pre-index EBITDA margin expansion on a YOY basis?

See, we will not be able to give you the guidance on FI27, Percy, but if you look at, let's say, the way we performed, and let me just give you the recent quarter example by just kind of stating the factual number. So, if you look at KFC business, the ADS in the current quarter was 90,000, previous quarter was 89,000, virtually flat. If you look at the SSSG, it was negative. And despite all of that, if you look at the brand contribution, we've managed to improve the brand contribution by more than 200 basis points. So what has really gone into that?

How has that 200 basis points been driven?

See, this is what I said. I mean, we've experimented with multiple things in terms of online, offline, how to kind of segregate the deals, how to do the mix. And so, so therefore, I mean, so those experiments are in progress, but we are seeing the results. So the point is that, and this is what I mentioned in the past, that we do have levers to optimize the EBITDA. I'm not saying that SSSG is not important. It is a very, very important KPI, and we are absolutely not running away from that. But we do have other levers, which is what I mentioned in the past. So, for example, if you remember, in our meeting, I had said that the brand contribution margins that KFC used to deliver at 125,000 ADS, in the current scenario, we are very confident that we'll be able to deliver those kind of brand contribution margins at about 105,000, 110,000 kind of ADS numbers. So, therefore, I mean, we've made progress on various initiatives, and it is getting reflected in the numbers.

I understood. But is there any more juice in the lemon here? What I'm trying to figure out is whatever cost-keeping initiative we have done till now, that's already there in your margins for this quarter. Now, if I have to look ahead and I'm not asking for guidance on FY27, I'm just looking for an algorithm as to how to model your business. That, let's say, if there is a zero SSG, is there any way you can still improve margins beyond what you have already done? Or now the margin improvement is going to be more a function of the operating leverage, which would typically, in cases, come only when the SSG goes beyond a 3% to 4% kind of a level.

For CC, I mean, using your phrase, I mean, of course, there is still juice there in the lemon. So, because, see, as I've said, the businesses are ever-evolving. We learn from what is happening in the environment. We learn from what is happening in the competition. We learn from what we have done in the past. So, therefore, it's an ever-evolving situation. So, I would not kind of call ever that, I mean, there's nothing more that we can do. That's how we look at the business, and that is how the group has always been. So, therefore, I mean, we always look at the initiatives. And now with merger happening, obviously we will have the synergies also coming in. We will have the technology piece kind of coming in our hands, which will give us the leverage in terms of pricing, how to structure the pricing, in terms of speed of moving with the innovation and various other initiatives. So I would say there are initiatives available, but at the same time, remember that it's a very complex business. It's a very decentralized retail environment, and that is where we continuously seek as to what the opportunities are sitting in which part of the business, and we continue to optimize.

Understood, understood.

Secondly, if I might ask, I request you to please rejoin the queue if we have any further questions. Thank you. Our next question comes from the line of Avi Mehta from Macquarie. Please go ahead.

Hi, Manish. Congratulations on the elevation. I wanted to just check with you on two things. One, I wanted to understand if this positive same-store sales flow that we saw in Jan, is this something that was specifically seen only in our format, so we could comment whether you've seen it across other peers, and whether you have seen any change in the discounting intensity in the space in the last few months. And the second question that I have was a bookkeeping one. My understanding is there has been an increase in India overheads. If you could confirm if that understanding is correct and what led to it. Those are the two things. Thank you.

So, Avi, to answer your first question first, obviously, I will not be able to comment on the peer group because we do not have the visibility on the peer group. But January numbers that we've seen, we are only talking about our scenario. So, that is one. Second, coming to the India overheads, as I've said in the past, please take 5% as normally the corporate G&A in terms of the broad guidance as far as our company is concerned. But this particular quarter, as you know, there has been an implementation of the labor code, and that kind of impacts the overall numbers. And there are some numbers which have got impacted above Vibidda, there are some below in terms of what the accounting standards are. But otherwise, the GNA remains more or less as guided earlier, and there's no significant deviation or variation on that.

So, Sajman, just to confirm this number, what's the amount that I should kind of remove to get a more stable state run rate in the India overhead?

So that's what I said. Let's say for 26-27, you can take a 5% GNA. Thank you.

Thank you, Nish.

Thank you.

Our next question is from the line of Gaurav Joghani from JM Financial. Please go ahead.

Thank you, and congratulations to you, Manish, for the elevation. My first question is with regards to, you know, the complexities of the business. I mean, while, you know, the India piece has grown at a different pace.

Sorry to interrupt, Gaurav, but your line is not very clear.

Am I audible now?

This is a little better. Please go ahead.

Thailand, if you remember, Gaurav, I mean, the April-May-June quarter is one of the best quarters. Nepal-Nigeria, while we've seen great growth, but as a constituent of the overall business, it's small. And that is where, and we've seen some negative Triple HG in our Thailand business as well. And Thailand, again, in January has done better versus what we saw in the previous quarter. But if you look at, let's say, from a gross margin perspective on the international side, the margins have improved by 90 basis points. If you look at the brand contribution, the overall business has improved by 40 basis points versus previous quarter, and almost 50 basis points versus the year ago. So I think we are on the right track as far as the international business is also concerned.

And just on the corporate overheads, you know, the corporate overheads for the international business also seems to have increased. So, is there some currency-related impact in that because it received the return?

I can check specifically on the currency-related piece, Gaurav, but otherwise underlying, we know that the corporate overheads for international have remained in line.

Yeah, QQ, it is in line, I would say that.

Sure, let me just check that out and come back to you.

Thank you.

Thank you. Our next question comes from the line of Amit Sajdeva from UBS. Please go ahead.

Hi, thank you so much for taking my question, and congratulations, Manish, on you all. My just one question on January improvement that we've seen, And obviously, you alluded to the several initiatives or at least the experiments you've run, maybe assume that pricing and how you kind of, you know, create the marketing mix for that. Could you give us a little bit of detail that what three, four things are you really excited about that are working very well? Is it a pivot to value or the larger pack or what sort of online and offline strategies are actually worth it? If you could give us some more detail about that, I really appreciate. And what do you think that are going to sustain and help you in the rest of the quarter as well?

Amit, as you know, all of these are business confidential details, and we will not be able to share that in the public forum. But obviously, as I said, there is enough and more opportunity available, both in the online and offline piece, that we can continue to optimize our offerings. We can continue to how we focus and play with the deals, with the discount mixes, and so on and so forth. So, I mean, obviously, we will not be able to lay out the marketing promotion and how we kind of approached it.

Sure. But, you know, just to understand that it is largely driven by how you promote and – or is it like some SKUs are working better, which I'm not really asking for any competitive sense of thing, just as a structural theme that which is working very well and which you feel is...

Sure, sure. I've got your point. So, we've experimented with some deals and the offerings in certain markets, which have given us good results, and we are wanting to kind of experiment that on a little bit better scale in other geographies as well. And we've experimented in other geography that has given the results again. So, therefore, I mean, that's the broad piece. It's how you approach the mix between the online-offline, where you focus, where you put more money. So, that's the kind of approach that we've taken.

Got it. Got it. Now, thanks so much for that. I really appreciate your input. Thanks, Manish, and all the best.

Thank you. Ladies and gentlemen, to ask a question, you may please press star and 1. Our next question comes from the line of Ashish Kanodia from Citi. Please go ahead.

Yes, thank you. Manu, just on the demand part, while I understand, you know, you have taken some of the strategic initiative, but if I also look at 3Q numbers, there's an improvement in KFC, there's an improvement in Costa Coffee as well sequentially. And if I just look at, you know, how the food aggregators have reported, there was some uptake in growth in 3Q as well. So, apart from the strategic initiative where you are seeing positive SLC coming through, if you look at 3Q, October, November, December, have you also seen some bit of a tailwind coming through the quarter, like sequentially had December been slightly better than November, adjusting for, of course, the seasonality?

So, Ashish, as Mr. Jaipudia mentioned in his address, he did mention that we are seeing some green shoot in the overall consumption environment. And obviously, when, let's say, that is happening, and plus we are kind of double-tipping bases, whatever we are doing, things start to happen. So we've already talked about that. So therefore, that kind of matches with the commentary that you're also hearing, because we are seeing it's too early. We would not like you guys to kind of make some definitive conclusions, basis that, but there are some green shoots which are kind of appearing.

Shavon, is that helpful? And just on the store expansion side, if I hear you correctly, in Pizzahut, you will not add any stores on a net versus in FY26. But on FY27, you know, just looking at the journey part of the business, how should we think about a store expansion for both KFC and Pizzahut?

So, Ashish, when I talked about 26, I actually meant the calendar year 26, which is large part of the financial year 26-27. So, therefore, until about December 26, we will have a neutralized NNU structure. From Jan to March of 27 is something that we are discussing, and we will come back to you guys. But again, the store additions will be minimal. It will not be as in the past. It will be a very, very small amount if required.

So, and for KFC?

KFC, as I said, our DA continues. We've inherited the Sapphire DA also. So, if you remember, we've said in the past that as far as DIL is concerned, we plan to add about 110 to 120 stores every year for KFC. That stays.

Thank you and congratulations on the news.

Thank you again for your interest and support, and for taking the time out to join us on this call. Thank you very much.

Thank you. Ladies and gentlemen, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

Thank you very much.