Restaurant Brands Asia Q3 Review- Burger King India On Track; Indonesia Strategy Revamped: Prabhudas Lilladher

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Prabhudas Lilladher Report

Restaurant Brands Asia Ltd. reported in-line margins despite increase in operating expenses due to sustained traction in older stores and cost control, despite average daily sales dropping to Rs 120,000 on softer demand.

We believe Jan-23 price hike will help neutralise the impact of increased overheads on store expansion. Burger King is looking to promote margin accretive chicken offerings in South market and compete versus incumbents.

Indonesia operations has lower average daily sales versus pre-Covid; new strategy is expected to improve average daily sales with-

relaunch/innovation in Whopper range,
increased focus on chicken offering,
focus on FSDT format and store rationalisation.

We believe Restaurant Brands Asia's India operations are on track and should report mid-single digit pre Indian Accounting Standard Ebitda with small profit in FY24 and full turnaround in FY25 given sustained customer traction and likely gains from BK Cafe in FY24.

We believe Indonesia business will take time to turnaround given delay in post Covid recovery, business restructuring and initial losses in Popeyes (5/30 stores in FY23/FY24).

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Prabhudas Lilladher Restaurant Brands Asia Q3FY23 Results Review.pdf

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