QSR industry focus: Dine-in channel growth remains muted on weakness in SSSG; Zomato, Swiggy fragmenting market share

Even as quick-service restaurants (QSR) rapidly expanded their store count after a strong recovery post Covid, the industry is currently witnessing sluggishness on the back of demand slowdown and a challenging macroeconomic environment. According to a report by BNP Paribas, the aggregate revenue growth of listed QSR companies was at 8 per cent YoY in Q1FY25, broadly in line with the 7-9 per cent seen in the last four quarters but well below the consensus expectations from the sector. It further maintained that the gross margins expanded as the cost of raw materials, such as milk, have moderated. However, EBITDA margins remained under pressure due to weakness in same store sales growth (SSSG).