RBA Q4 FY26 earnings call.
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Revenue
₹707 Cr
verified against source
Revenue YoY
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EBITDA
Pending
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Where this quarter sits.
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What the record says.
Restaurant Brands Asia delivered a strong Q4 FY26 with India's BK business hitting 6.3% SSG—its highest in 12 quarters—driven by value leadership (2-for-79/999), premium layer expansion (King's Collection, Korean LTO), and accelerating digital penetration at 91% digital orders. The company achieved 70.2% gross margin in Q4 (FY26 full year: 69%), a year ahead of prior guidance, through cluster supply-chain strategy and product mix optimization. Restaurant-level AITA margins reached 11.6% (vs. 5% in FY22), with absolute restaurant EBITDA growing 5x to ₹264 crore. However, Indonesia remains a drag: ₹120 crore impairment was taken in Q4 amid BK's ongoing turnaround (positive store-level AITA but Popeyes losing ₹25 billion) and pending promoter transition. Management targets FCF breakeven in 4-6 quarters with FY28 as full FCF-positive year. Key risks: Indonesia funding needs, LPG supply crisis management, and upcoming Inspa Global acquisition requiring CCI approval. Revenue of ₹2,271 crore represents 2.4x growth since FY22 with disciplined cost control underpinning margin expansion.
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Guidance to track
- India business expected to achieve FCF breakeven in 4-6 quarters, targeting full FCF-positive year for FY28 while funding 60-80 annual restaurant openings.
- BK Indonesia targeting restaurant-level margins to recover its overhead (GNA) approximately 4 quarters out, supported by delivery margin improvement to 6.2-6.4 range.
- Long-term goal over 4-5 years to build cafe average daily sales to ₹25,000 per restaurant; mature converted stores significantly above average.
- Revised outlook to be provided in Q1 FY27 once the Inspa Global acquisition transaction is completed and new promoters are onboarded.
Risks flagged
- Popeyes Indonesia lost ₹25 billion in FY26, compounding losses from a business already 4.5-5 years into losses. Analyst directly questioned management on timeline for structural exit or turnaround, noting Indonesia is driving down consolidated performance.
- India facing LNG crisis; management outlined conversion to electric broilers (half electricity consumption) and PNG migration as mitigation, but acknowledged some LPG-dependent restaurants face supply challenges.
- Analyst raised concern that incoming promoter (Jollibee/Lennox) controls both RBA and other QSR brands, asking about potential conflicts and firewall protections for minority shareholders. Management deflected as 'premature' with zero conversations on any merger.
- ₹120 crore impairment taken on Indonesia balance sheet; while management claims this fully provides for carrying value, no further impairment timeline was provided and fund infusion requirements remain undisclosed.
Key quotes
- We ended the year at a gross margin at 69%. Happy to share that for the quarter we were at 70%. Which is the exit that we have as far as gross margin is concerned. We've been able to move the target to get to 70% almost by a year from what we had spoken with you all earlier.
- Our ambition is over the next four five years to get that volumes [cafe ADS] to come somewhere close to 25,000 rupees per restaurant per day.
- I think a couple spoken about building the premium layer and that comes at a higher APC and a higher at least rupees gross margin. That effort continues but a lot of ancillary items that we have introduced as you can see the fizz drinks the new cone the waffle cone these are very high gross margin.
- We are working towards getting to be cash flow neutral over next 6 to 8 quarters. That's the target that we have and that is something which has always been our journey.
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