A clash between Pizza Hut’s two largest franchisees in India—Sapphire Foods and Devyani International—has led to a pause in joint advertising efforts, adversely affecting sales across shared territories, Sapphire Foods’ CEO confirmed on Friday.
In a post-earnings call, Sanjay Purohit, Group CEO of Sapphire Foods, said mass media advertising for Pizza Hut has been suspended since the January–March 2025 quarter due to differing views between the franchisees on marketing strategy and advertising investments.
“Starting Q4 FY25, we have not been able to invest in mass media advertising for Pizza Hut. That’s resulted in an impact on our transactions,” Purohit said, citing a strategic disconnect with sister franchisee Devyani International.
While Yum! Brands—the owner of Pizza Hut, KFC, and Taco Bell—is aligned with Sapphire’s advertising approach; the impasse has left joint campaigns in limbo. The lack of advertising coordination in overlapping markets such as Maharashtra, Andhra Pradesh, and Karnataka is particularly concerning, as both companies operate across delivery-only, takeaway, and airport formats in these regions.
Devyani International, which is owned by Ravi Jaipuria, holds franchise rights in North and East India and operates more than 2,000 stores. Sapphire Foods controls operations in South and West India with over 900 outlets. Jaipuria declined to comment when contacted by ET.
Devyani International’s earnings report for the January–March quarter is expected later this month, which may shed more light on their stance.
Asked about the timeline for resolving the issue, Purohit estimated that it could take one to two quarters. “The difference of opinion stems from our belief in the effectiveness of mass media advertising in driving transactions. The only way forward is to use data to prove its impact,” he stated.
The dispute comes at a time when India’s quick-service restaurant (QSR) industry is witnessing a general slowdown in sales, making brand visibility and strategic marketing more critical than ever.