Restaurant Brands Asia FY26: India hits a margin milestone while Indonesia stays a portfolio question

Restaurant Brands Asia Limited closed FY26 with a clear split in performance between its two geographies. India delivered steady growth with improving profitability, while Indonesia remained loss-making on a consolidated basis despite a reported turnaround in Burger King Indonesia at the store level.

For India, FY26 revenue from operations rose to INR 22,717 million, up 15.4% year on year, supported by net store additions and positive same store sales growth. The company ended March 31, 2026 with 581 stores in India, up 68 year on year. Average daily sales were reported at INR 116,000 for FY26, with same store sales growth of 4.0%. Gross margin improved to 69.0% for FY26, up 1.3% year on year. Restaurant EBITDA, measured pre Ind AS 116, increased to INR 2,636 million, up 27.4% year on year, while company EBITDA pre Ind AS 116 rose to INR 1,324 million, up 33.2%.

The fourth quarter showed acceleration. Q4 FY26 revenue from operations in India was INR 5,735 million, up 17.1% year on year. Same store sales growth was 6.3%, which management described as the highest in the last 12 quarters. Q4 gross margin reached 70.2%, and restaurant EBITDA pre Ind AS 116 expanded to INR 759 million with a margin of 13.2%. Company EBITDA pre Ind AS 116 was INR 409 million with a margin of 7.1%.

Management attributed the India momentum to a combination of traffic building and mix improvement. Value leadership remained central, with ongoing focus on entry price offers and bundled meals, while menu innovation expanded the premium layers. The company also described strengthening of the burger ladder through products such as the Kings Collection and the Whopper Deluxe range, supported by limited-time offerings including Korean-themed menu items.

Digital remained a major operating lever. The presentation stated that 91% of all orders are through digital channels in stores with self-ordering kiosks, supported by table ordering and service in restaurants except food courts. Management also highlighted CRM traction, citing 51% year-on-year growth in monthly active users. The company positioned digital adoption as improving customer engagement and offering better control over transactions and consumer data.

Profitability initiatives extended beyond pricing and mix. Management described delivery profitability improvement of over 2% in FY26 versus FY25, driven by pricing actions and lower discounting. The company also emphasized cost efficiencies, including utilities savings through solar efforts and a new broiler. On the earnings call, management said the new broiler is electric and uses about half the utilities of the old broiler, and that installation across India restaurants should complete in the next couple of months from the call date.

Indonesia continued to weigh on consolidated performance, but the brand-level picture differed sharply. In the presentation, Burger King Indonesia finished FY26 with 137 stores, ADS of IDR 18.6 million and positive store EBITDA of IDR 8.2 billion. Popeyes Indonesia remained at 25 stores and reported store EBITDA losses of IDR 24.9 billion in FY26. On a consolidated Indonesia basis, restaurant EBITDA was negative for FY26, and company EBITDA was also negative.

The operating performance table for Indonesia, expressed in INR million, reported FY26 revenue from operations of INR 5,509 million, down 5.5% year on year. Gross profit percentage improved to 57.1% versus 56.1% in FY25, but reported company EBITDA remained negative.

Management commentary acknowledged that Indonesia requires structural action, especially for Popeyes. The CEO stated that Popeyes Indonesia is struggling and that without significant capital commitment to scale from around 25 stores to several hundred, the path is difficult. Management also said that this business needs to be part of someone else’s portfolio rather than RBA’s, while the company remains focused on strengthening Burger King.

On consolidated numbers, the company reported FY26 revenue from operations of INR 28,226 million, up 10.7% year on year. Consolidated gross profit percentage was 66.7% for FY26. Restaurant EBITDA post Ind AS 116 was INR 5,208 million, while reported company EBITDA was INR 3,411 million. On a pre Ind AS 116 basis, consolidated company EBITDA was INR 750 million for FY26.

Looking ahead, management reiterated India store expansion guidance of 60 to 80 new restaurants per year, and noted that FY26 net store additions of 68 were within this range. On cash flows, management stated on the call that the company is working towards free cash flow neutral for the India business over the next 6 to 8 quarters, and agreed with an analyst framing that FY28 is targeted to be free cash flow positive.

The key investor debate remains the extent and timing of portfolio action in Indonesia versus the improving trajectory in India. The documents show that India has reached a high gross margin exit rate and is expanding EBITDA, while Indonesia, especially Popeyes, continues to dilute consolidated performance. Management indicated that a revised outlook will be shared in Q1 after completion of the Inspira Global transaction.