Westlife Foodworld Limited Q2 FY27 Earnings Conference Call Transcript

Financial Performance Highlights

Revenue Performance:

  • Q2 FY27 revenue reached ₹747 crore (₹7.47 billion), representing 16% year-on-year growth
  • Strongest top-line growth in 13 quarters
  • Double-digit same-store sales growth of 10.1%
  • Double-digit guest count growth achieved in each month of the quarter

Profitability Metrics:

  • Operating EBITDA grew 29% year-on-year
  • Operating EBITDA margin expanded by 130 basis points to 13.1%
  • Restaurant operating margin remained healthy at 19.3%
  • Cash PAT stood at ₹526 million, representing 7% of sales

Channel Performance:

  • On-premise channel grew 17% year-on-year
  • Off-premise channel grew 15% year-on-year
  • Digital channels contributed over 75% of sales (60 bps increase YoY)
  • Cumulative app downloads exceeded 58 million
  • Approximately 4.2 million monthly active users

Operational Highlights

Store Expansion:

  • Added 11 new restaurants during Q2 FY27
  • Total footprint reached 492 restaurants across 80 cities
  • Approaching 500th restaurant milestone
  • On track for target of 580+ restaurants by March 2028

Inflation Impact:

  • Absorbed 190 basis points of inflationary pressure across commodities, utilities, and employee costs
  • Specific mention of extraordinary wage inflation in Karnataka
  • Commodity inflation particularly in oil prices

Strategic Business Updates

Value Platform Strategy:

  • Everyday Value platform including ₹99 meal and GMA Lite driving guest growth
  • Value strategy focused on reducing discounting while maintaining affordability
  • No material price increases taken during the quarter
  • Typical annual price increase of 3-4% expected for FY27

Regional Performance:

  • Broad-based growth across both West and South regions
  • Growth numbers converging between regions after previous disparities
  • Operating structure strengthened in South region

Digital Initiatives:

  • Own delivery platform trials ongoing in Mumbai
  • Focus on understanding cost structure before broader rollout
  • Partnership with third-party delivery operators remains strong

Management Guidance and Outlook

Margin Guidance:

  • Maintained guidance of 100-150 basis points improvement in profitability year-on-year
  • Confidence in achieving this despite inflationary pressures

Expansion Plans:

  • Capex per store in range of ₹3-3.5 crores
  • Full-year capex expected between ₹250-300 crores
  • Target of 60-65 new restaurant openings per year

Growth Momentum:

  • Strong momentum continued into October 2026
  • Confidence entering festive season
  • Focus on maintaining high single-digit growth as minimum target

Analyst Q&A Key Points

Promotional Intensity: Management clarified no increase in discounting; value platform strengthened without extra discounts

Pricing Strategy: Typical 3-4% annual price increase taken through multiple sub-levers including discount optimization

Guest Count Quality: Growth driven by both new customer acquisition and increased frequency

Competitive Landscape: No significant changes in competitive intensity noted

Delivery Performance: Both dine-in and delivery channels showing balanced growth