
Macquarie has highlighted recovery in the quick-service restaurant (QSR) sector, with growth momentum accelerating in December 2024, based on channel checks. The firm notes positive trends across the restaurant industry, supported by key drivers.
Key observations:
- Recovery in growth:
- Faster growth momentum across the QSR industry, with brands like KFC and McDonald’s leading on proprietary restaurant brand indices.
- This supports Macquarie’s top pick, Devyani International, which operates the Yum India franchise.
- Policy support:
- Proposed tax reductions in the upcoming February budget could accelerate same-store sales growth (SSSG) beyond current estimates.
- Stock preferences and targets:
- Devyani International: Initiate outperform; target price set at ₹230/share.
- Sapphire Foods: Initiate outperform; target price set at ₹390/share.
- Other preferences include Westlife Development and Jubilant FoodWorks.
Macquarie remains optimistic about the QSR sector’s recovery and highlights Devyani and Sapphire Foods as key beneficiaries of the improving macro environment and policy changes.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.