Speciality Restaurants Targets Growth, Bolstered by Expansion

Ashwin Thakker

16 Aug 2025 — 2 min read

Key Facts on Outlook:

Sales Outlook: Aiming for 10-15% growth; expecting Same Store Growth (SSG) from August 2025 onwards.
New Openings: Planning 7 new Asian, 2 new Italian restaurants; 3 more Walters Burger stores this quarter, 5 by FY26 end.
Renovation Impact: Renovated Mainland China stores show 20-30% annual revenue growth.
Margin Outlook: Operational EBITDA margins improved to 6.2%; favorable inflation helped gross margins to 70.2%.
Capital Strategy: INR 162 crore treasury and internal cash flow fully fund expansion; no external fundraising planned.

Speciality Restaurants Limited recently shared its Q1 FY26 earnings insights, outlining a clear path for future growth. Bolstered by a strong INR 162 crore treasury, the company is poised for significant expansion. Key initiatives include new restaurant openings, strategic brand renovations, and enhanced operational efficiencies, all aimed at driving robust revenue and margin improvements.

Strategic Expansion Driving Future Revenue

Speciality Restaurants is charting an aggressive expansion roadmap, targeting significant growth this financial year. The company plans to open 7 new Asian and 2 new Italian restaurants. A key focus is expanding the Quick Service Restaurant (QSR) segment with the Walters Burger brand, aiming for

"3 more Walters in this quarter, and hopefully, 5 more by the end of this financial year."

These new ventures, coupled with strategic renovations of older Mainland China outlets into upgraded Asia Kitchens, are critical. These conversions have historically yielded

"a growth in revenues ranging between 20% to 30% on a yearly basis."

The company's INR 162 crore treasury comfortably funds this expansion, with new units typically breaking even within 3 to 6 months.

Efficiency Gains and Margin Optimization

The company reported improved operational EBITDA margins, rising from 4.5% to 6.2% in Q1 FY26. This improvement is attributed to

"managing efficiencies on expenses and new restaurants contributing to the bottom line."

Gross margins also improved to 70.2% due to favorable inflation, despite the withdrawal of service charges. Speciality Restaurants refines its delivery strategy by operating 11 dedicated cloud kitchens and integrating dark kitchens within new physical stores, boosting revenue while managing costs. Geographically, the focus remains on saturating Mumbai and Kolkata markets, with future plans to expand into Hyderabad and Tier 2 cities. The outlook for Same Store Growth (SSG) is positive for upcoming quarters.

Speciality Restaurants Limited is embarking on a decisive growth phase, marked by strategic new restaurant openings, extensive brand renovations, and a fortified balance sheet. The focus on expanding high-potential brands like Siciliana and Walters Burger, alongside operational efficiencies and a planned ramp-up in Same Store Growth, positions the company for a positive trajectory. Their clear, self-funded expansion strategy underscores confidence in future performance.

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