Pizza Hut reset in focus as Devyani International appoints new CEO
New president and CEO Manish Dawar said the company will add zero net new Pizza Hut stores in calendars 2025 and 2026 and will instead shift attention to fixing the fundamentals.
Closing loss-making stores as well as improving technology, an area where Devyani lags behind its peers, is a key priority, he said, adding that the clean-up drive could take several years.
Pizza Hut also said it will see sharper marketing, a stronger innovation pipeline and more targeted online-offline strategies as the company works to stimulate demand.
Dawar acknowledged that Devyani’s previous operating structure was split into Yum! Brands, Sapphire Foods and Devyani have slowed down their decision-making and technology investments, making them less agile than their rivals.
The ongoing merger with Sapphire Foods aims to rectify this situation, with Devyani taking control of technology and supply chain operations; management believes this will accelerate Pizza Hut’s reset.
Dawar said the company began experimenting with promotions, value deals and differentiated online and offline strategies, which helped deliver a positive same-store sales increase in January.
“We are starting to take initiative and we are seeing early results,” he said. “But it is too early to draw any conclusions. We will come back with a sustainable strategy as things evolve.”
Leadership changes
Devyani International announced on Wednesday that Dawar will be appointed as the new president and CEO, effective April 1, 2026, and will transition from his role as chief financial officer to lead the company’s growth and merger with Sapphire Foods.
He will replace Virag Joshi, who will remain with the company as a non-executive director. Virag Joshi, who has been with Devyani for over two decades, will remain closely involved with the company in a non-executive role, ensuring continuity as the group moves into its next phase of growth.
Devyani announced new leadership changes as part of the CEO transition. Anupam Kumar, currently vice president of finance, will be the new CFO. He has over 20 years of experience working at Vedanta and Walker Chandiok & Co. before joining Devyani’s parent company, RJ Corp.
The company also appointed Neeraj Tiwari as chief technology officer and emphasized its focus on digital-first approach in the QSR industry. Tiwari previously led digital technology at Americana Group, a major restaurant operator in the Gulf region, and has also worked with Zee Entertainment and Jubilant FoodWorks.
Business restructuring
The pizza chain’s reset comes after the company merged with rival Sapphire Foods on Jan. 1 to form Yum! It took place right after the company announced that it would create a single operator for . Brands in India at a time when the fast-food industry is under pressure due to weak demand and shrinking margins.
The agreement is expected to be completed within 15-18 months. ₹Annual synergies from the second year onwards stood at ₹210-225 crore, giving Devyani scale and tighter control over technology and supply chains; This is critical at a time when Pizza Hut is struggling in India and globally.
Its revenue from operations in the December quarter 2025-26 was as follows: ₹1,440.9 crore, up 11.3% year-on-year.
Devyani International’s number of restaurants worldwide increased from 2,039 at the end of March 2025 to 2,279 as of December 31, 2025.
While there were 1,664 sales points in India nine months ago, this number has increased to 1,877. Among Yum! KFC became the largest chain, with the number of Brands’ stores increasing from 696 to 788. Pizza Hut just added nine new locations, bringing its total to 639.
The number of franchise brands such as Costa Coffee and Tealive fell slightly, falling from 220 to 211. But Devyani’s own brands, including Vaango, Biryani By Kilo and Goila Butter Chicken, have more than doubled its footprint by increasing the number of stores from 96 to 218.
Internationally, Devyani had 402 restaurants in Thailand, Nigeria and Nepal; this number was 375 in March, with most additions in Thailand.
Sandeep Abhange, equity research analyst, consumer and staples at LKP Securities, said demand remained unbalanced in the December quarter, with pressure on discretionary spending delaying a broader consumption recovery. “Festival-led promotions helped improve trends for November and December, but management is guiding for a gradual recovery through Q4 rather than a sharp recovery,” he said.
He noted that KFC remains Devyani’s strongest player, delivering positive same-store sales growth (SSSG) and healthy store-level margins. “Pizza Hut India remains in negative SSSG territory, leading to ongoing store rationalization and portfolio pruning,” he said.
He added that although discounting intensity on aggregator platforms has been rationalized to maintain margins, delivery now accounts for around 55-60% of sales, supported by value-oriented offerings and deeper digital penetration. “Traffic trends are starting to stabilize, with mature stores showing better efficiency.”
On expansion, Devyani added about 250 gross stores in the last 12 months despite selectively closing underperforming Pizza Hut outlets, Abhange said. “The company is taking a calibrated approach to growth, focusing on Tier II and III cities where store economics are better and prioritizing return on invested capital over core expansion.”
Margins also showed the first signs of recovery in the quarter. This support was provided by easing food cost inflation on key inputs such as poultry, cheese and cooking oils, although employee costs remained high due to wage pressures and staffing in new stores. “Store-level EBITDA has increased sequentially and management expects a gradual margin recovery trajectory,” Abhange said.
Shares of Devyani International closed with an increase of over 6 percent ₹123.30 on BSE on Wednesday, reflecting a strong positive market reaction to this development.
