Speciality Restaurants Expands Footprint Fuels Future Growth

Ashwin Thakker

16 Aug 2025 — 2 min read

Sales Outlook: Targeting 10-15% revenue growth; expecting Same Store Sales Growth (SSG) to improve from August 2025 onwards.
Expansion Plan: Planning to open 7 new Asian/Italian restaurants and 5 Walters Burger QSRs by FY26 end.
Renovation Impact: Converted Mainland Chinas show 20-30% revenue growth, boosting asset turnover. New restaurants breakeven in 3-6 months.
Margin Outlook: Operational EBITDA margins improved to 6.2%; Gross margins increased to 70.2% due to favorable inflation and efficiencies.
Funding: Holds INR 162 crore treasury for capex; no external funding or leverage currently explored.

Speciality Restaurants' Q1 FY26 earnings call underscored a clear forward-looking strategy. The company is actively expanding its footprint and refining operational efficiencies. Key insights revealed robust plans for new restaurant openings, strategic brand conversions, and continued focus on margin enhancement, pointing to a promising outlook for sustained growth and profitability.

Strategic Expansion Fuels Revenue Growth

Speciality Restaurants projects robust future growth through strategic expansion. The company plans to open 7 new Asian and Italian restaurants, plus 5 Walters Burger quick-service restaurants (QSRs) by fiscal year-end. This expansion prioritizes high-potential markets such as Mumbai and Kolkata. Management stated they are

"working hard toward"

achieving a 10-15% revenue growth target. Furthermore, an improvement in Same Store Sales Growth (SSG) is anticipated from August onwards, driven by expected increases in consumer discretionary spending. New restaurants are projected to breakeven within 3 to 6 months, contributing swiftly to the top line. This outlook underpins a clear strategy for revenue acceleration.

Operational Efficiency and Margin Enhancement

Speciality Restaurants effectively optimized its operational margins. Operational EBITDA margins improved from 4.5% to 6.2%, driven by expense efficiencies and new restaurant contributions. Gross margins also rose to 70.2%, up from 69.2%, primarily due to favorable inflation. The company strategically renovates older Mainland China outlets into Asia Kitchens, a move yielding 20-30% yearly revenue growth and improved asset turnover. New formats like Walters Burger offer minimal capex and rental costs due to their smaller footprint. Financially, the company holds a strong treasury of INR 162 crores (as of June 2025) for expansion, eliminating the need for external funding.

Speciality Restaurants is poised for significant future growth, driven by a well-defined strategy of aggressive expansion into new formats and key markets. The company's focus on operational efficiencies, coupled with strategic renovations, promises enhanced profitability. With a strong financial position, Speciality Restaurants is well-equipped to capitalize on market opportunities and reinforce its leadership in the dynamic F&B sector.

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