Devyani International merges 3 subsidiaries, consolidating 100 outlets across 40 Indian cities

INDIA – Devyani International has amalgamated three wholly owned subsidiaries, Sky Gate Hospitality, Blackvelvet Hospitality, and Say Chefs Eatery, into the parent company effective April 1, 2025, streamlining operations across more than 100 outlets in 40 Indian cities.

The consolidation aims to deliver operational synergies, improve resource utilization, and reduce corporate tiers while leaving the shareholding pattern unchanged with no fresh shares issued.

Simplifying a Complex Web

The three subsidiaries operated dine-in locations and cloud kitchens across major metropolitan areas including Delhi NCR, Mumbai, Kolkata, and Bengaluru.

By absorbing them directly, DIL eliminates redundant administrative layers and creates a more efficient management structure.

The company stated the merger is intended to maximize “value creation for stakeholders” through improved asset utilization and reduced operational costs.

Building on a Massive Footprint

DIL currently operates over 2,000 outlets across more than 280 cities in India and international markets including Nigeria, Nepal, and Thailand.

Beyond its core Yum Brands franchise portfolio, KFC, Pizza Hut, and Taco Bell, the company also holds franchise rights for Costa Coffee, New York Fries, Sanook Kitchen, and Tea Live. The merger positions these diverse brands for more cohesive management and growth.

Navigating Financial Headwinds

The consolidation comes amid mixed financial performance. DIL reported a consolidated net loss of ₹103.9 million (approx. US$1.2 million) for Q3 FY26, compared to a ₹4.9 million loss in the same period last year.

However, excluding a one-time charge related to India’s new labor laws, the company posted a profit of ₹659.8 million (approx. US$7.3 million) for the December quarter.

Timing Coincides with Major Merger

The internal restructuring follows DIL’s January 2026 announcement of a merger agreement with Sapphire Foods India, combining two of India’s largest Yum! Brands franchise operators.

That deal, expected to take 12 to 15 months to complete, will create one of the country’s biggest quick-service restaurant groups, uniting operations for KFC, Pizza Hut, and Taco Bell across their combined networks.

The subsidiary merger streamlines DIL’s own structure in advance of that larger integration.

Leadership Transition Underway

The operational consolidation coincides with leadership changes.

DIL recently elevated CFO Manish Dawar to CEO and President, effective April 1, 2026, to lead the company through its next growth phase. Dawar succeeds Viraj Joshi, who remains as non-executive director.

The subsidiary merger gives Dawar a cleaner organizational structure to work with as he guides the company through both the Sapphire Foods integration and ongoing market challenges.

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