Core biz recovery, biryani bet boost Devyani outlook

Analysts positive on planned acquisition, upgrade the stock

- RAM PRASAD SAHU

The stock of quick-service restaurant (QSR) major Devyani International was up 4 percent on Monday after it said it was considering the acquisition of a controlling stake in Sky Gate Hospitality, which operates restaurants under the brand Biryani By Kilo (BBK) as well as other brands.

The firm will raise money through the issue of equity shares on a preferential basis to fund the acquisition.

Sky Gate posted revenues of ₹300 crore in 2024-25 (FY25), growing annually by 55 percent over 2018-19 (FY19) through 2023-24 (FY24).

In addition to the BBK chain, which has 100 outlets and has expanded to 45 cities, Sky Gate also operates other brands such as Goila Butter Chicken, The Bhojan, and Get-A-Way.

While revenues have grown at a healthy pace, the company has posted operational losses given the accelerated store openings.

Devyani will acquire Goila Butter Chicken, The Bhojan, and BBK, which had registered net sales of ₹260 crore in 2024-25 (FY25), with 80 percent of this contributed by BBK.