Devyani International Ltd (NSE: DEVYANI) Q3 2026 Earnings Call dated Feb. 04, 2026
Corporate Participants:
Ravi Jaipuria — Non-Executive Chairman
Manish Dawar — Whole-time Director and Chief Financial Officer
Analysts:
Unidentified Participant
Anoop Poojari — Analyst
Devanshu Bansal — Analyst
Jaykumar Doshi — Analyst
Tejas Shah — Analyst
Percy Panthaki — Analyst
Gaurav Jogani — Analyst
Ashish Kanodia — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Divyani International Learnings Conference Call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing STAR and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anup Pujari from CDR India. Thank you. And over to you sir.
Anoop Poojari — Analyst
Thank you. Good afternoon everyone and thank you for joining us on Devyani International’s Q3 and 9M FY26 earnings conference call. We have with us Mr. Ravi Jay Puriya, non executive chairman of the company, Mr. Raj Gandhi, non executive director, Mr. Virak Joshi, CEO and whole time director and Mr. Manish Dhawar, CFO and whole time Director of the Company. We’ll initiate the call with opening remarks from the Chairman followed by key financial highlights from the cfo. Thereafter we will have the forum open for a question and answer session. Before we begin, I would like to point out that some statements made in today’s call may be forward looking in nature and a disclaimer to this effect has been included in the results presentation shared with you earlier.
I would now request Mr. Ravi Jaipuria to make his opening remarks.
Ravi Jaipuria — Non-Executive Chairman
Good afternoon everyone and thank you for joining us today. It’s my pleasure to welcome you all to Debyani International’s post Results Earnings Conference call to discuss our performance for the third quarter 25:26 we continue to invest in and steadily expand our core business in India. New store openings accelerated during the quarter with 54 net new KFC outlets and 18 net additional additions to Pizza Hut. With this, we have not added any net new Pizza Hut stores on a cumulative basis during the calendar year 2025 within our brand’s portfolio, we have also added 17 new stores to Biryani by Kilo and Vango.
The international business added 20 new stores during the quarter between Thailand and Nepal, all at the end of Q3 2026, the total store count for DIL stood at 2279 stores. We are happy to state that we have achieved breakeven brand Ebitda results by Biryani by Kilo much ahead of our target as guided earlier. In parallel, we are also bringing innovative new products to our customers. We recently introduced the Dunked range in KFC Fried Chicken coated in a bold and fairy barbecue sauce. The product launch has been accompanied by a promotional campaign focusing on the indulgence and Craving features a well known comedian and actor which has been well received.
We also have launched the Crafted Flats range of pizzas featuring a hand stretched crust option with seven new flavorful toppings to choose from. It is a great example of a global product launched that is being customized for regional preferences. We have seen encouraging initial response from our patrons. Our business continues to grow in a sustained manner. India operations grew 12.1% year on year while consolidated revenues reached 1441 crores growing 11.3% year on year. Our international business continues to gather strength from operations and profitability perspective and same is reflected in the steady improvement in the results.
Earlier this year we announced the proposed. Merger with Sapphire Foods, a transformative step that will create one of the largest diversified FNB platforms in India. The combined entity will have more than 3,000 stores globally and a turnover approaching USD $1 billion. We are very excited regarding this new chapter in your company’s growth phase. We have also started the process of turnaround of the Pizza Hut business by shutting down loss making stores. Our idea is to bring a sharper focus to this excise and with this as an objective, we are not planning to add any net new units to our Pizza Hut portfolio.
We will open the new stores only to compensate for the closure of loss making stores. This will also help us to utilize the existing assets and equipments in our new stores and bring down the capex for the new openings as well. We have seen positive SSSG across all our brands in the month of January except Pizza Hut where the losses are being contained. We are expecting that if this momentum continues through the quarter this will lay a strong foundation for future growth. On the macro front, we are beginning to see some early signs of consumption coming back in a few sectors in the broader economy.
Thanks to the government support and fiscal measures, we have used the last few quarters to build a leaner and more resilient organization. With the proposed merger underway, we are confident that we will emerge as a stronger and more agile business well placed to accelerate growth by capitalizing on opportunities that are available. DIL is at a critical inflection point in this growth journey as we prepare to scale into a larger, more diversified and more complex organization. The Board believes that this next phase requires a bold strategic vision backed by strong execution capability. Given the background, I would like to briefly touch upon the important leadership decisions at the board meeting today.
Viragh has expressed his desire to superannuate from the company. The Board has accepted his request effective March 31, 2026 and has requested him to continue as a non Executive Director and provide his valuable insights on strategic matters as and when required. I would also like to acknowledge Viraj’s invaluable contribution to dil’s journey over the last more than two decades. We thank him for his leadership and wish him all the best with all his future endeavors. Manish Tower shall get elevated as President and CEO for DIL with effect from April 1, 2026. Maneesh joined us almost five years back as CFO for the company and has played a very significant and pivotal role in shaping the company’s growth trajectory including the successful public listing.
He he has also led key strategic initiatives including the acquisition of Thailand Business, the acquisition and turnaround of Skygate Hospitality brands, Biryani by Kilo and Guela Butter Chicken and more recently the proposed merger with Sapphire Foods. He has over three decades of leadership experience across very reputed and well known global and Indian entrepreneurs with leadership roles at Vodafone India, Vedanta Reckitt, Ben Geyser Reebok. Having started his career at Hindustan Unilever, he has wide experience across multiple industry domains and various geographies in the world. The Board and I feel that he is well placed to take over the role of the expanded DIL as President and CEO.
I would also like to wish and his team the very best to take DIL even to greater heights as we make progress with the merger. I am also pleased to inform you that Mr. Anupam Kumar, currently EVP Finance will take over the role of CFO. Anupam has over two decades of experience before joining Ajay Corp with Vedanta Walker, Chandog and Co llp. This will add depth and continuity to the company’s financial leadership and will make DIL ready for the post merger scenario. With this I would like to conclude my address and now I hand over to Manish for the financial highlights.
Thank you very much.
Manish Dawar — Whole-time Director and Chief Financial Officer
Thank you Mr. Jaipuria. Good evening everyone. A very warm welcome and thank you for your valuable time for attending DIL’s quarter three FY26 earnings conference call, our 18th such call since our listing in August 21st. At the outset I would like to thank the Chairman and the Board for reposing the trust and confidence in me to lead DIL at such an exciting and transformative juncture. With dial’s deep operational capabilities, strong brands, expanding scale and growing digital and technology backbone, we are uniquely positioned to build a future ready QSI platform that delivers sustained and long term value for our stakeholders.
We will be announcing the broader leadership team for DIL in due course as we progress with the merger coming Back to the results. As of December 21, 2025 our total network stood at 2279 stores comprising of 1174 KFC stores and 648 Pizza Hut stores. We also launched our first Sanuk Kitchen outlet in Gurgaon. Sanu Kitchen brand is for Thai and Asian food lovers. The consolidated operating EBITDA for Q3FY26 was rupees 1441 crores up 11.3% y on y. Consolidated Q3FY26 gross profit came in at Rs 993 crores up 11.7% yny with margins at 68.9% reflecting an improvement of 20 basis points y on y.
Excluding Skygate the improvement is 70 basis points y on y and 110 basis points versus quarter two FY26. Consolidated brand contribution was higher at rupees 200 crores versus rupees 185 crores last year. LED by our India and international operations, the brand contribution margin improved to 13.9% versus 11.7% in the previous quarter. I’m happy to report that Skygate Brands posted a breakeven brand ebitda. This is ahead of our initial expectation and guidance given earlier. Consolidated operating EBITDA on a pre Index basis was rupees 124 crores with margins at 8.6% versus 6.8% in the previous quarter. Reported EBITDA was Rs 227 crores with margins at 15.7%.
Indian operations grew 12.1% YNY to reach rupees 978 crores in revenues. Gross margin came in at 71% virtually flattish on YNY basis. Excluding Skygate the GM improvement stands at 60 basis points versus the previous year. KFC in India added 54 net new stores in quarter three FY26 taking the total store count for KFC in India to 788 stores as of 31st December. Average daily sales for quarter 3 FY26 was stable sequentially at 90,000 rupees. Revenues at rupees 603 crores were up 5.9% YNY. Gross margin at 69.8% showed 1.2% improvement compared to the same quarter last year.
The improvement in gross margin was offset on account of deleveraging deleverage impact because of lower ADS and higher delivery revenues. Brand Contribution margin was rupees 101 crores with margins at 68.8%, 40 basis points lower versus the previous year we opened 18 net new Pizza Hut stores in quarter 3 FY26 ending with 639 stores in India. Pizza Hut India revenue for the quarter was 178 crores with ads at 31,000 rupees. Gross margin was at 76% and improvement of 1.2% from the preceding quarter. Despite deleverage on lower sales, we managed to effectively control costs and delivered positive brand contribution of rupees 1.4 crores and margins at 0.8% for the quarter, improvement of 1% from the previous quarter.
We also started to shut the loss making stores. We have taken steps to turn around the Pizza Hut business. We will start to shut down the loss making stores in the Pizza Hut portfolio and our plan is not to add any net new units in the brand for 2026. However, we will ensure that the overall store count remains broadly in line with December 25th numbers. Franchise brands which include Costa Coffee and the newer brands in India posted revenues of Rs 56 crores with Y on Y stable gross margins at 75.7% and brand contribution of rupees 8.8 crores with margins at 15.7% improvement of 5.2% versus the preceding quarter.
Our own brand’s portfolio which includes Vongo Biryani by Kilo and Goela Butter Chicken recorded a healthy growth with rupees 94 crores in revenues and gross margins at 64.2%. Brand contribution margin came in at 9% reflecting the turnaround in the profitability of Skygate portfolio. We achieved breakeven brand EBITDA for Skygate in the month of December. The Skygate portfolio continues to perform in line with our expectations. With the growth momentum carrying through quarter three. With margins improving and the integration nearly completed, we have started to scale up the brand in a measured manner. This quarter we added 13 net new stores under the Skygate portfolio in Dil’s existing Food Court locations.
We do report that Vango has crossed a count of 100 stores in this quarter. The revenues for the quarter came in at rupees 20 crores and the brand continues to maintain its healthy gross margins and the brand contribution. Our international business continues to demonstrate resilience and strong performance. Revenues reach rupees 473 crores in quarter 3 FY26 up 10.1%. YNY with improved gross margins at 64.9%. Brand contribution of rupees 81 crore representing 17.1 margins is higher on YNY basis. Let me also take this opportunity to briefly update you on the merger process. We have already submitted our applications for exchange approvals and we’ll also be shortly filing the application for CCI approval.
At this point we do not anticipate any material deviation in the merger timeline that we’ve outlined earlier. While we continue to execute towards building a geographically diverse multidimensional FNB platform, Yum brands ie KFC and Pizza Hut and India business will continue to anchor our business. The proposed merger will further help us build a strong growth foundation in India and the estimated annual merger Synergies of approximately rupees 210 to Rs 225 crores will allow us a greater headroom to invest in India and grow the business. In our view, QSR remains one of the most promising segments in the consumption category and we believe we have the brands and the management capability to build a market leading business.
On that note, I would like to request the moderator to open the forum for any questions or suggestions that you may have. Thank you very much.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their Touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 1. Participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Devanshu Bansal from MK Global. Please go ahead.
Devanshu Bansal
Hi. Thanks for the opportunity and congratulations on your good operational performance at the onset. Viraz, kudos to your long career at Digani and execution discipline with healthy operational.
Ravi Jaipuria
Your voice is not very clear. Hi Devanshu.
Devanshu Bansal
Yeah. Is it better now?
Ravi Jaipuria
Hello? No.
Ravi Jaipuria
Yes. Better now.
Ravi Jaipuria
Yeah, exactly.
Devanshu Bansal
Yeah. Is it better now?
Ravi Jaipuria
Yep.
Devanshu Bansal
Yeah. I was saying Virag, kudos to your career and execution on healthy operational savings despite a prolonged macro weakness. And Manish, congratulations and all the best for your new role as CEO of the merged entity. Just Manish starting off. Still there is some time for the CEO hat, but you have been in the system for quite some time checking if you would like to share some initial thoughts on your key focus areas for ramping up the next phase of the growth journey for Digyan.
Manish Dawar
So I think Devanshu, obviously it is too early to kind of comment on this piece and as you said I have been in the system long enough and therefore we all know and this is not hidden. Our biggest priority will be to turn around the SSG and ADS numbers and this can only happen with multiple measures. And obviously we have to bring a completely enabling environment so that we are able to take these actions forward. So we will come back to you in due course of time in terms of what the new leadership team will be, what will be our strategy, and so on and so forth.
But otherwise the operational priority remains very, very important. We have to be ready with the leadership team before we get into a merger consummation scenario. We need to have a strong technology focus because we all recognize that Divyani is lagging behind on technology versus some of the other peer group. So these are the top priorities that I would say. But we will come back to you as and when things evolve.
Devanshu Bansal
No, fair enough. Manish, Looking forward to the updated strategy. The second question, obviously the commentary mentions that most formats have seen positive SSD. In January 26, I wanted to understand the key initiatives which have led to this improvement. Just to better gauge the sustainability of this SSG turnaround.
Manish Dawar
We experimented Devanshu with some ideas on the promotions, on the deals. We’ve changed little bit of our strategy in terms of how we deal with the online business and offline business. So that has really kind of helped us with the January SSSG numbers. As Mr. Jaipuriya said, that Pizza Hut is still to be kind of done. But again, this is just one month in a quarter. We’ve just started doing experiments. We are seeing the results, as I said, in terms of what the sustainable strategy will be. We will come back to you in due course of time.
Devanshu Bansal
Sure. Just a small follow up here. So how do we see our improved gross margin profile? Whether we have invested back some of the savings at the gross level to revive this SSG or the Jan trends are mostly with the 70% SSG that we have reported in KFC.
Manish Dawar
Devanshu, broadly we will be able to maintain the gross margins profile. I mean it could be here and there by whatever some basis points, but largely the gross margin profile will be maintained.
Devanshu Bansal
Sure. Thanks for taking my questions, Manish.
Manish Dawar
Sure. Thanks a lot, Devanshu.
operator
Thank you. Our next question is from the line of J. Doshi from Kotak. Before you go ahead, sir, let me remind participants that they may press STAR and one to ask a question and to please limit your questions to one per participant. You may rejoin the queue if you have follow up questions. Jay Doshi, you may proceed with your question.
Manish Dawar
Jay, we are not able to hear you.
Jaykumar Doshi
Okay. Is this better?
Manish Dawar
Yeah.
Jaykumar Doshi
Now we can hear you. Okay. Yes. I’ve got two questions. First one is you know this EBITDA growth of or absolute EBITDA pre inde days of 124crore. You know, do you think that, you know, this is even in a weak environment a similar EBITDA margin or absolute EBITDA adjusted for seasonality you should be comfortable maintaining and should we expect improvement over the course of coming quarters from this level?
Manish Dawar
Jai we feel so because as I’ve said in the past it was the continuous negative triple SG which was kind of pulling us down and as you know in the previous quarter we started consolidating biryani by kilo and biryani by kilo was a loss making portfolio and that’s where the previous quarter numbers got impacted, impacted. So we’ve managed to turn around biryani by kilo to a break even level and therefore that has helped us. Our Nepal Nigeria operations have done exceedingly well. Thailand is very, very stable. If you look at the losses in triple HG in the KFC business in India they are better than what we’ve seen in the past and therefore we are hopeful that we should be able to maintain the EBITDA numbers.
Jaykumar Doshi
Sure. Second question is on KFC, for a brand with such Strong Brand Equity, 10 odd quarters of SSSG decline, can you give us some indication of what could be the impact of cannibalization on SSSG of KFC and is there any thought internally to perhaps slow down store edition for KFC for a year or so and try and improve SSSG and profitability of that business?
Manish Dawar
Jay if you look at our store opening pace and I’m talking about here KFC as a brand and not DIL so much, if you look at, let’s say in the last five years we’ve gone to almost close to three to four times of what the base store count used to to be and obviously if you are opening stores at that pace there will be some amount of cannibalization which will seep in. I think what is required to be done on KFC is a very differentiated strategy from an online and offline perspective, a very differentiated strategy from how we treat the brand innovation again from an online and offline perspective and we’ve started discussing that internally, we’ve started taking some steps and that’s what Mr.
Jaipuri alluded that we’ve seen positive triple Hg in January month. So the idea is that we need to have the right steps and a strategic direction in terms of how the food sector has evolved after the entry of online players like Zomato and Swiggy. And that is what the focus area is going to be because if you look at for example, I mean I don’t want to name the competition but the nearest competitor in QSR is sitting at more than twice the store count that we have in KFC and therefore those results are fine. And that is the inspiration for us to ensure that we continue to grow kfc.
However, we have to sort things out in terms of the strategy piece and, and we will come back to you on those.
Jaykumar Doshi
Understood. Final question is, you know you had a certain incentives linked to store openings per year. Now in the new agreement that you know you may have signed with Yum, do you still have, you know, a similar level of commitment in terms of store editions for KFC or has it been relaxed in context of the weakness that Indian market is seeing?
Manish Dawar
See Jai right now, for example, let’s say during the merger discussions it was more of what are the merger conditions and how will the merger take place and yam’s approval and so on, so forth. Both the companies had independently signed the development agreements. They will continue and obviously we will inherit whatever was signed by Safire. Having said that, obviously we will present the complete KFC strategy to the parent organization which is Yum Brands and we will have that discussion in terms of what is right for the brand. Because for Yum also India remains a top priority as far as growth is concerned.
And Pizza Hut, as you know we’ve already mentioned that we’ve scaled back and even for 25 there was 0 NNUS, 26 again there are going to be 0 NNUS. So therefore pizza Hut, we’ve recognized that and the focus is turnaround whereas KFC is seen as a growth brand. But nonetheless we take your point and that is something which is kind of pending discussion from our side with Yam.
Jaykumar Doshi
Thank you so much and Manish, wish you the very best for your new role.
Manish Dawar
Thank you so much.
operator
Thank you. Our next question comes from the line of Tejas Shah from Avendus Spark Institutional Equities. Please go ahead.
Tejas Shah
Hi, thanks for the opportunity and Manish, congrats on the promotion and best wishes for the new role. You tried asking this but I’m also pushing my luck here. So you have had a front seat row to the prolonged struggle that we have seen in last many quarters and then you have multiple unfinished on the table today. So what would you prioritize in the sense fixing or ramping up KFC first or fixing Pizza Hut as a model first and then you have a lot of long tail of other projects as well. So just wanted to understand without too much detail there.
Manish Dawar
So Tejas. I think I’ve discussed this whole scenario multiple times with see, traditionally we were operating like a multi environment business. So there was Yum, there was Safire and there was us. So any decision making used to happen as a three way approach by way of consensus. Whereas competition had that advantage of being very nimble footed, faster decision making, investing in technology. In our case it was a fractured environment from a multiple perspective. And I think the biggest strategic move that we have taken is to consolidate the two companies. And as we’ve discussed in the previous call that we will take over technology operations from Yum, we will take over supply chain management from Yum.
Now all of these things will come back and help us and therefore once we overlay that with the operations piece, I think it’s a great win win combination for us. And that’s the reason it was very important that we kind of sort out the largest structural issue which is where we were hugely hampered and impacted by. And that is what something that we’ve managed to do not yet in practice because we are undergoing the regulatory approvals which will take some time and this is the time we’ll utilize for strategy building. And in terms of what is that we need to do on Blastex, while let’s say the merger processes is currently on in terms of approvals.
Tejas Shah
Perfect. And second on this January commentary that we have put out, apart from the ssg, what are the other operational indicators which are actually helping us to or guiding us to say that this could be sustainable and not a false start that we have seen multiple times in last two, three years?
Manish Dawar
See, as I mentioned earlier, I’m not saying that, I’m just saying factually that January has been positive and let’s see, it is just one month. I don’t want you guys to draw any conclusions based on that. We need to look at how the whole quarter goes. We need to experiment with the initiatives we’ve taken in other geographies. So it’s early. I agree with you, but we just wanted to indicate the factual situation.
Tejas Shah
Thanks and all the best for the coming.
Manish Dawar
Sure. Thank you so much.
operator
Thank you. Our next question comes from the line of Saksha from Old Bridge Capital. Please go ahead.
Unidentified Participant
Hi team. Thank you for taking my question. Just one on Pizza Hut. So you indicated that you started to sort of shut down the loss making stores and that is getting compensated by the new addition. Just wanted to get a sense on, you know, basically automation lead through. How far do we have to go in terms of shutting these stores down? Like how many stores if you can just give us an indication on how many stores such stores are there and what would be your initial read through on what is not working for us in these stores? Is it standardization or competition or something else? That’s the only question I have.
Manish Dawar
See we’ll have to handle again Pizza Hut from multiple fronts. So one important element is shutting the loss making stores. The other important element is having technology for the brand which is where we have been missing. We need to make sure that the marketing is much more effective. We need to make sure that the innovation pipeline is stronger. And as I said that, I mean all of these initiatives will transition from yum to us. Now that is going to take about a year. In the meantime we’ve started taking this initiative on cleaning up the loss making stores.
It will take a couple of years to finally sort it out but we’ve absolutely started this exercise and now once we have the CCI approval, obviously between us and Safire, we are not in a position to talk to each other at this stage. But once we have the CCI approval, we will sit jointly and route a merged company strategy plan for Pizza Hut because that is where we need to kind of work together very, very intensively by the time the entire process gets finished. So we will come back to you on that piece once we have more detail.
Manish Dawar
Sure. Thank you.
operator
Thank you. The next question comes from the line of Percy from iifl. Please go ahead.
Percy Panthaki
Hi Manish, just one very basic question I wanted to ask you and this is ignoring any merger synergies that you might get a year or two later. But like for FY27, what is the minimum SSSG that you need to deliver so that you can have a pre index EBITDA margin expansion on a YY basis?
Manish Dawar
See, we will not be able to give you the guidance on FY27 per se. But if you look at, let’s say the way we performed and let me just give you the recent quarter example by just kind of stating the factual number. So if you look at KFC business, the ADS in the current quarter was 90,000, previous quarter was 89,000, virtually flat. If you look at the triple SG it was negative. And despite all of that, if you look at the brand contribution, we’ve managed to improve the brand contribution by more than 200 basis points.
So that is what I have mentioned.
Percy Panthaki
Sorry, what has really gone into that? How has that 200 basis points been driven?
Manish Dawar
See this is what I said. I mean we’ve experimented with multiple things in terms of online offline, how to kind of segregate the deals, how to do the mix. And so therefore, I mean, so those experiments are in progress, but we are seeing the results. So the point is that, and which is what I mentioned in the past, that we do have levers to optimize the ebitda. I’m not saying that triple SG is not important. It is a very, very important KPI and we are absolutely not running away from that. But we do have other levers, which is what I mentioned in the past.
So for example, if you remember in our meeting I had said that the brand contribution margins that KFC used to deliver at 125,000 ADS in the current scenario, we are very confident that we’ll be able to deliver those kind of brand contribution margins at about 105, 110,000 kind of ads numbers. So therefore, I mean we’ve made progress on various initiatives and it is getting reflected in the numbers.
Percy Panthaki
Understood. But is there any more juice in the lemon here? What I’m trying to figure out is whatever cost saving initiatives you have done till now, that’s already there in your margins for this quarter. Now if I have to look ahead, and I’m not asking for a guidance on FY27, I’m just looking for an algorithm as to how to model your business that let’s say if there is a 0sssg, is there any way you can still improve margins beyond what you have already done or now the margin improvement is going to be more a function of the operating leverage which would typically cases come only when the SSG goes beyond a 3 to 4% kind of a level.
Manish Dawar
Persisi. I mean using your phrase, I mean of course there is juice, there is still juice there in the lemon. So because see, as I’ve said, the businesses are ever evolving. We learn from what is happening in the environment, we learn from what is happening in the competition, we learn from what we have done in the past. So therefore it’s a ever evolving situation. So I would not kind of call ever that. I mean there’s nothing more that we can do. That’s how we look at the business and that is how the group has always been.
So therefore, I mean we always look at the initiatives and now with merger happening, obviously we will have the synergies also coming in, we will have the technology piece kind of coming in our hands which will give us the leverage in terms of pricing, how to structure the pricing in terms of speed of moving with the innovation and various other initiatives. So I would say there are initiatives available. But at the same time, remember that it’s a very complex business. It’s a very decentralized retail environment. And that is where we continuously seek as to what the opportunities are sitting in which part of the business and we continue to optimize.
Percy Panthaki
Understood? Understood. Secondly, if I might first request you.
operator
To please rejoin the queue if you have any further questions. Thank you. Our next question comes from the line of Avi Mehta from Macquarie. Please go ahead.
Unidentified Participant
Hi Manish. Congratulations on the elevation. I wanted to just check with you on two things. One, wanted to understand if this positive same store sales growth that we saw in Jan, is this something that was specifically seen only in our format so you could comment whether you’ve seen it across other peers and whether you have seen any change in the discounting intensity space in the last few months. And the second question that I had was a bookkeeping one. My understanding is there has been an increase in India overheads. If you could confirm if that understanding is correct and what led to it.
Those are the two things. Thank you.
Manish Dawar
So Avi, to answer your first question first, obviously I will not be able to comment on the peer group because we do not have the visibility on the peer group. But January numbers that we’ve seen. We are only talking about our scenario. So that is one second coming to the India overheads. As I’ve said in the past, please take 5% as normally the corporate GNA in terms of the broad guidance as far as our company is concerned. But this particular quarter, as you know, there has been an implementation of the labor code and that kind of impact the overall numbers.
And there are some numbers which have got impacted above ebitda. There are some below in terms of what the accounting standards are. But otherwise the GNA remains more or less as guided earlier and there’s no significant deviation or variation on that.
Unidentified Participant
So. So just to confirm this number that what’s the amount that I should kind of remove to get a more stable state run rate in the India overhead.
Manish Dawar
So that’s what, that’s what I said for let’s say for 26, 27, you can take a 5% GNA.
Unidentified Participant
Okay, thank you. Thank you.
Manish Dawar
Thank you.
Unidentified Participant
Thanks so much.
operator
Thank you. Our next question is from the line of Gaurav Jogani from JM Financial. Please go ahead.
Gaurav Jogani
Thank you. And congratulations to you, Manish, for the elevation. My first question is with regards to, you know, the entrance piece of the business while you know, the India piece has grown at a decent pace.
operator
Sorry to interrupt, Gaurav, but Your line is not very clear.
Gaurav Jogani
Am I audible now?
operator
This is, this is a little better. Please go ahead.
Gaurav Jogani
Yeah. So first of all I would like. To congratulate Manish on his elimination for the post of CEO. My question to Manish is regarding the international piece of the business where you know, the growth has been I would say a bit muted despite, you know, Naiveta and Nepal doing better. So is there some impact on the growth in the Thailand piece of the business? Because Q3 typically is a good seasonal business for them.
Manish Dawar
So Thailand, if you remember Gaurav, I mean the April, May, June quarter is the is is one of the best quarters. Nepal, Nigeria, while we’ve seen great growth but as a constituent of the overall business it’s small. And that is where. And we’ve seen some negative SSSG in our Thailand business as well. And Thailand again in January has done better versus what we saw in the previous quarter. But if you look at let’s say from a gross margin perspective on the international side, the margins have improved by 90 basis points. If you look at the brand contribution, the overall business has improved by 40 basis points versus previous quarter and almost 50 basis points versus the year ago.
So I think we are on the right track as far as the international business is also concerned.
Gaurav Jogani
Just on the corporate overheads bit only we know the corporate overheads for the international business also seems to have increased. So is there some currency related impact in that because of it seems a bit higher.
Manish Dawar
I can check specifically on the currency related piece, Gaurav. But otherwise underlying we know that the corporate overhead for international have remained in line.
Gaurav Jogani
Yeah. Q. Q. It is in line. I would say that.
Manish Dawar
Sure. Let me, let me just check that out and come back to you. Thank you.
operator
Thank you. Our next question comes from the line of Amit Sachdeva from ubs. Please go ahead.
Unidentified Participant
Hi. Thank you so much for taking my question and congratulations Manish on new role. So my just one question. On January improvement that you’ve seen and obviously you alluded to the several initiatives or at least the experiments you’ve run, maybe assume that pricing and how you kind of, you know, create the marketing mix for that, could you give us a little bit of detail that what three, four things are you really excited about that are working very well. It is a pivot to value or the larger pack or what sort of online and offline strategies are active activities.
If you could give us some more detail about that I’ll really appreciate and what you think that are going to sustain and help you in the rest of the quarter as well.
Manish Dawar
Amit, as you know, all of these are business confidential details and we will not be able to share that in the public forum. So but obviously as I said, there is enough and more opportunity available both in the online and offline piece that we can continue to optimize our offerings. We can continue to how we focus and play with the, with the deals, with the discount mixes and so on and so forth. So I mean obviously we will not be able to lay out the marketing promotion and how we kind of approached it.
Unidentified Participant
Sure. But you know, just to understand that it is largely driven by how you promote and. Or is it like some skus are working better which I’m not really asking for any competitive sensitive just as a structural theme that which is working very well and which you feel is.
Manish Dawar
Sure, sure, I’ve got your point. So we’ve experimented with some deals and the offerings in certain markets which have given us good results and we are wanting to kind of experiment that on a little bit better scale in other geographies as well. And we’ve experimented in other geography that has given the results again. So therefore, I mean that’s the broad piece. It’s how you approach the mix between the online offline where you focus, where you put your more money. So that’s the kind of approach that we’ve taken.
Unidentified Participant
Got it, got it. Thanks so much for that. I really appreciate your input. Thanks Manish and all the best.
operator
Thank you. Ladies and gentlemen, to ask a question you may please press star and one. Our next question comes from the line of Ashish Kanodia from Citi. Please go ahead.
Ashish Kanodia
Yeah, thank you. Just on the demand part. While I understand, you know, you have taken some of the strategic initiative, but if I Also look at 3Q number, there’s an improvement in KFC, there’s an improvement in pasta, coffee as well sequentially. And if I just look at, you know how the food aggregators have reported there was some uptick in growth in 3Q as well. So apart from the strategic initiative where you are seeing positive SSE coming through, if you look at three October, November, December, have you also seen some bit of a tailwind coming through the quarter like sequencing had December been slightly better than November adjusting for of course the seasonality.
Manish Dawar
So Ashish, as Mr. Jaipuriya mentioned in his address, he did mention that we are seeing some green shoots in the overall consumption environment and obviously when let’s say that is happening and plus we are kind of double dipping basis one, whatever we are doing, things start to happen. So we’ve already talked about that. So therefore that kind of matches with the commentary that you are also heading because we are seeing it’s too early. We would not like you guys to kind of make some definitive conclusions basis that. But there are some green shoots which are kind of appearing.
Ashish Kanodia
That’s helpful. And just on the store expansion side, if I hear you correctly, in Pizza Hut, you will not add any stores on a net versus in FY26. But on FY 2027, you know, just looking at Divyani part of the business, how should we think about store expansion for both KFC and Pizza Hut?
Manish Dawar
So Ashish, when I talked about 26 I actually meant the calendar year 26 which is large part of the financial year 2627. So therefore until about December 26th we will, we will have a neutralized and a new structure from Jan to March of 27 is something that we are discussing and we will come back to you guys. But again, the store additions will be minimal. It will not be as in the past. It will be a very, very small amount if required. Shannon, for kfc. Kfc, as I said, our DA continues. We’ve inherited the Sapphire DA also. So if you remember, we’ve said in the past that as far as DIL is concerned, we plan to add about 110 to 120 stores every year. For KFC, that stays.
Ashish Kanodia
Sure. Manish, thank you and congratulations on the news.
Manish Dawar
Thanks Ashish.
operator
Thank you. Ladies and gentlemen. We will take that as our last question. I would now like to hand the conference over to the management for closing comments. Over to you, sir.
Manish Dawar
Thank you very much. We hope we have been able to answer all your questions satisfactorily. Should we need any further clarifications or would like to know more about the company, please feel free to contact our investor relations team. Thank you once again for your interest and support and for taking the time out to join us on this call. Thank you very much.
operator
Thank you ladies and gentlemen. That concludes this conference. Thank you all for joining us. You may now disconnect your lines.
Manish Dawar
Thank you very much.