2026-05-15 13:43:49
Latest Post
Deep Industries Ltd consolidated Q4 FY2025-26 loss at Rs. 14.35 crores
Data Patterns India Ltd Q4FY26 PAT climbs to Rs. 138.38 crores
KRBL Ltd posts consolidated PAT of Rs. 155.38 crores in Q4 FY26
Pitti Engineering Ltd consolidated Q4 FY2026 profit declines to Rs. 26.61 crores
Mukand Ltd reports consolidated PAT of Rs. 554.98 crores in Q4 FY2026
Research
Speciality Restaurant - Specially for investment in burgeoning fine-dining space - Destimoney
Posted On : 2012-10-27 00:21:19( TIMEZONE : IST )
Speciality Restaurants Ltd (SRL), one of the leading fine-dining restaurant operators in India, has been able to build successful brand presence in the highly competitive and unorganized restaurant industry through a chain of restaurants under the brands Mainland China, Oh!Calcutta, Machaan, Sigree, Flame & Grill and Haka in major cities.
- SRL's restaurants are strategically located in either metro or tier-I cities with a majority of them in Western India, which has the highest proportion of people dining out regularly. The company's COCO (Company owned company operated) model reduces the risk of dilution of quality, service and overall brand value. However, it seeks to expand opportunistically through franchising on a FOCO (Franchise owned company operated) model, which would allow it to penetrate further into the metro and tier-I / tier II cities.
- SRL's strong cash flows and capital structure provides financial flexibility to fund growth. Also SRL leases out its restaurant properties making it an 'asset light', reducing the capital requirement and thus enabling faster growth.
- Organised restaurant industry which formed ~16% of Rs.430 billion Indian restaurant industry in 2010 is likely to grow at at 32% CAGR. faster than industry CAGR of 8% in next five years. Changing lifestyle and high standard of living has led to an increased number of people going to various restaurants which should provide a boost to the organized players.
- The company's prudent expansion strategy, primarily funded by internal accruals would also enable it to manage the overall risk in this business.
- We believe successful brand presence in the fine dining segment, rising demand for international cuisine, higher discretionary spending and rising urbanization bodes well for the company. Therefore, we initiate a coverage on Speciality Restaurants Limited with BUY rating and a target price of Rs.222 per share.
