Westlife Foodworld Ltd., the operator of McDonald’s restaurants across western and southern India, reported a 52% decline in quarterly profit as rising input and operating costs outweighed revenue growth, underscoring the mounting challenges facing India’s quick-service restaurant (QSR) industry.
The company posted a consolidated net profit of ₹5.9 million for the quarter ended June 30, down from ₹12.3 million in the corresponding period last year. Revenue, however, rose nearly 12% to ₹7.36 billion, compared with ₹6.58 billion a year earlier.
The earnings reflect growing cost pressures on restaurant operators, with higher energy, labour and raw material expenses squeezing margins. Industry players have also been forced to step up promotional offers to remain competitive amid intensifying rivalry from emerging food chains and café brands.
Westlife Foodworld has faced increased competition from fast-growing brands such as California Burrito, Wow! Momo and Blue Tokai Coffee, prompting greater discounting that has weighed on profitability.
During the quarter, McDonald’s continued its value-led strategy by promoting its ₹99 Everyday Value Meal, which includes a burger, fries and a Coca-Cola beverage, as consumers remain price-conscious despite improving demand.
The results highlight the balancing act confronting India’s QSR operators, which are seeing healthy sales growth but continue to battle elevated operating costs and aggressive competition as they seek to protect market share and margins.