Westlife Foodworld Ltd - Potential Buy

Westlife Development Limited (WDL) focuses on establishing and operating McDonald’s restaurants across West and South India, through its wholly owned subsidiary Hardcastle Restaurants Pvt Ltd (HRPL). Today, It manages 319 McDonalds restaurants and 223 McCafé outlets in West and South India in easily accessible and popular locations like malls, high-streets, shopping complexes and residential areas’ after outlet presence. It employees close to 10,000 employees. Investment Rationale: Ÿ Westlife Foodworld Limited, focuses on setting up and operating Quick Service Restaurants (QSR) in India through its subsidiary Hardcastle Restaurants Pvt. Ltd. (HRPL). The Company operates a chain of McDonald’s restaurants in West and South India having a master franchisee relationship with McDonald’s Corporation USA, through the latter’s subsidiary. Ÿ• HRPL serves over 200 million customers, annually, at its 421 (as of December 31, 2024) McDonald’s restaurants across 67 cities in the states of Telangana, Gujarat, Karnataka, Maharashtra, Tamil Nadu, Kerala, Chhattisgarh, Andhra Pradesh, Goa along with parts of Madhya Pradesh and Union Territory of Puducherry. McDonald’s operates through various formats and brand extensions including standalone restaurants, drive- thrus, McCafe, 24x7, McDelivery, McBreakfast and dessert kiosks. Ÿ• During Q3FY25, it has reported Rs.654 crores in revenue for the quarter, marking a 9% year-on-year increase. Same Store Sales Growth turned positive at 3%, recovering from a 6.5% decline previously, with growth driven by higher footfalls. Gross margin rose 40 bps to 70.1% despite inflation. However, operating EBITDA and restaurant margins declined 200 bps due to higher A&P spends. Profit after tax was Rs.5.20 crore, representing 8% of sales.