Restaurant Brands Asia Ltd Management Discussions

MANAGEMENT DISCUSSION AND ANALYSIS

Global Economy:

The global economy grew steadily at about 3.4% in both 2024 and 2025. However, the overall environment remained uncertain. Rising trade protectionism and higher tariffs imposed by the United States affected global trade, while geopolitical tensions, including unrest in the Middle East and the Israel-lran war, continued to weigh on investor confidence and economic stability.

Though challenges are partly offset by strong investment in technology, especially Al, in North America and Asia, ongoing conflicts continue to add pressure through higher commodity prices, rising inflation and increased financial stability risks.

Outlook

According to the International Monetary Fund (IMF), overall global growth is expected to be 3.1% in 2026 and 3.2% in 2027. However, the overall trend reflects a more challenging global environment marked by geopolitical tensions, tighter financial conditions and ongoing inflationary pressures. Advanced economies are expected to experience a gradual slowdown, with growth easing from 1.9% in 2025 to 1.8% in 2026 and further to 1.7% in 2027. This moderation reflects weaker productivity gains, tighter monetary conditions and subdued consumer demand across several major economies. Inflation is likely to rise to 4.4% in 2026 before easing to 3.7% in 2027. Emerging and developing economies, especially those dependent on commodity imports, are likely to face greater challenges due to higher energy prices, supply disruptions and continued global uncertainty. While risks such as prolonged conflicts, inflation and financial market volatility may slow growth, continued investment in Al and coordinated policy measures could help maintain stability and support growth over the medium term.

Indias economy continued to show strong momentum in FY 2025-26, with GDP growth estimated at 7.6% (base year 2022-23), supported by steady domestic demand, ongoing policy reforms and a gradual recovery in both private and public investments. This growth was largely driven by strong consumption and increased investment activity, particularly in the second half of the year. The manufacturing sector remained a key contributor, recording consistent double-digit growth of 11.5% in FY 2026, up from 9.5% in FY 2025, white the services and industrial sectors also supported overall economic performance. The trade, hotels, transport and communication sector showed steady improvement, rising from 6.6% in FY 2025 to 10.1% in FY 2026, supported by a recovery in consumption and service demand.

At the same time, the economy faced external challenges due to global uncertainties. Higher trade tariffs and geopolitical tensions affected export performance, especially to West Asia, following the conflict that began in late February 2026. Despite these headwinds, trade agreements with the European Union and the United States provided some support and indicated strengthening economic ties.

The government also continued to support businesses through reforms such as GST rationalisation and the simplification of compliance reguirements, which improved the overall ease of doing business.

In FY 2025-26, the Reserve Bank of India (RBI) shifted its policy to support growth and reduced the repo rate by 125 basis points. The rate was lowered from 6.50% to 5.50% by October 2025 and was further reduced to 5.25% in December 2025 as inflation eased. On April 8, 2026, the RBI kept the repo rate unchanged at 5.25% and adopted a neutral stance, aiming to maintain stability while balancing growth and inflation amid global uncertainties.

Outlook

The outlook for Indias economy remains favourable, supported by strong domestic consumption, rising disposable incomes, and increasing urbanisation, which are driving higher discretionary spending and shaping evolving lifestyle choices. Consumers are increasingly seeking convenience, variety, and more premium experiences, reflecting a shift in consumption patterns. These trends are enabling businesses to expand their reach, deepen customer engagement, and adopt more efficient, technology-led operating models. At the same time, ongoing infrastructure development and improvements in the business environment are supporting expansion into new and emerging markets within the country. While external uncertainties and input cost pressures remain key considerations, overall demand trends and changing consumer preferences continue to create strong growth opportunities across the economy.

In 2025, Indonesias economy showed strong resilience, growing by 5.1% YoY despite global uncertainties. Growth was supported by steady domestic demand, with households spending increasing by 5.1% and government expenditure rising sharply by 9.0% during 2025. Investment also grew, while exports and imports contributed modestly to overall growth. Inflation remained low and stable at 2.8%, well within the central banks target range, reflecting strong monetary management. The current account deficit was 0.5% of GDP and foreign exchange reserves were healthy at USD 150.4 billion in 2025, providing the country with a cushion against external shocks. Overall, Indonesia maintained growth and stability in 2025, driven by prudent policies, strong domestic demand and a resilient financial system, although the global economy faced challenges. On the external front, rising trade tensions, ongoing uncertainty and volatility in global financial markets pose significant challenges. However, stronger structural reforms and an accelerated approach to trade generate meaningful positive impacts on the economy.

Outlook

Looking ahead, Indonesias economy is expected to grow modestly, reaching around 5.1% in 2026. Household spending is likely to stay steady, while government spending may ease slightly and investment is expected to pick up further. Exports are also projected to contribute positively, helping the country expand and strengthen its trade position. Inflation is expected to remain low at 2.6% by the end of 2026, down from 2.8% in 2025, keeping it within the target range. Foreign reserves are projected to increase from USD 150.4 billion in 2025 to USD 157.9 billion, supporting overall economic stability. Structural reforms, such as improved trade policies, better infrastructure and increased digitalisation, are likely to boost productivity and create more opportunities for businesses. In 2026, the government established the National Nutrition Agency with a USD 16 billion budget to provide meals to approximately 80 million people. By comparison, in 2025, the program fed 56 million people at a cost of USD 3 billion, using about 72.5% of its allocated funds. Overall, these proactive fiscal and monetary measures, togetherwith ongoing reforms, are expected to help Indonesia sustain steady economic growth in 2026.

Sources:

IMF Executive Board Concludes 2025 Article IV Consultation with Indonesia, IMF. January 2026

Indonesias Unconventional 2026 Budget, The Diplomat. February 2026

Global Food Services Market

The global food service market includes a wide range of businesses that prepare and serve food for dine-in, takeaway and delivery. These include quick-service restaurants (QSR), full-service restaurants, cafes, catering services and food delivery platforms. The global food service market was valued at approximately USD 3.19 trillion in 2025 and is projected to reach USD 4.27 trillion by 2034, growing at a CAGR of around 3.3% during the forecast period. This steady growth reflects sustained demand across both developed and emerging markets, supported by the continued shift toward convenience-driven dining.

Asia Pacific remained the largest region, accounting for around 37% of the global market in 2025, driven by strong growth in countries such as China, India and Southeast Asia. The commercial segment, including Quick Service Restaurants (QSRs), cafes and full-service restaurants, dominated the market with about 72% share, highlighting the strong preference for eating out and ordering in. Globally, the market is witnessing a structural shift toward digital ordering and off-premise consumption, with online delivery platforms and mobile apps becoming central to the consumer experience. At the same time, trends such as cloud kitchens, Al-driven operations, sustainable packaging and plant-based menu options are reshaping how food service businesses operate and engage with customers.

Indian Food Services Market

The Indian food service market is growing rapidly, driven by a mix of economic, social and lifestyle changes. Younger consumers, especially millennials and Gen Z, are also playing an important role. They are more willing to spend on diverse food experiences and are open to trying global cuisines. At the same time, the expansion of guick-service restaurants (QSRs) and the influence of global food trends are reshaping consumer choices nationwide. The Indian food service market was valued at Rs.5,717 billion in FY 2025 and is expected to reach Rs.9,688 billion by FY 2030, growing at a CAGR of 11.1%.

The organised segment, which includes chain outlets and organised standalone restaurants, is growing even faster. It was valued at Rs.2,862 billion in FY 2025 and is projected to reach T5.797 billion by FY 2030, at a CAGR of 15.2%. Organised market share is expected to increase from 50.1% in FY 2025 to around 60% by FY 2030, indicating a shift from unorganised to more structured formats. Within the organised segment, standalone restaurants held the largest share. This standalone restaurants segment accounted for 68% of the organised market in FY 2025, was valued at Rs.1,954- billion and is expected to grow to T3.722 billion by FY 2030 at a CAGR of 13.8%.

Food Services Market CAGR & Market Share

Format	CAGR FY 2020-25	CAGR FY 2025-30	Market Share FY 2020	Market Share FY 2025	Market Share FY 2030P
Organised Standalone	8.8%	13.8%	75%	68%	64%
Organised Chain	15.3%	18.7%	25%	32%	36%

Source: Technopak Analysis; P: Projected

Opportunities and Challenges in the Indian Food Service Market

1. Digitalisation and Food Delivery Growth

The rapid growth of smartphones and internet penetration has significantly transformed how consumers access food services. Online delivery platforms have made ordering food more convenient and accessible. This has allowed restaurants to expand their reach and generate additional revenue streams.

2. Increasing Demand for Diverse and Global Cuisines

Greater exposure to global food trends has encouraged consumers to experiment with different cuisines and flavours. Restaurants are responding by diversifying their menus and introducing international offerings. This trend is driving innovation and enhancing the overall dining experience.

3. Untapped Potential in Tier II and III Cities

Smaller cities are witnessing rising incomes, urban development and changing consumer preferences. As awareness and exposure increase, demand for organised food services is also growing in these regions. This presents significant opportunities for expansion beyond major metropolitan areas.

A. Growing Women Workforce

Rising participation of women in the workforce is significantly influencing food consumption patterns. Female Labour Force Participation Rate (LFPR) increased to 35.1% in January 2026 from 34.1% in April 2025, reflecting a steady rise in working women. With more dual-income households, there is a growing preference for convenience, ready-to-eat meals and eating out. This is driving demand for food-service restaurants and food-delivery platforms that offer speed, consistency and variety.

5. Increasing Nuclear Families

Smaller households and time-constrained lifestyles are increasing reliance on takeaways and delivery services. Unlike larger joint families, nuclear households tend to spend more on convenience and dining experiences, benefiting food service restaurants and casual dining formats. This trend is also encouraging frequent, smaller orders rather than large, occasional meals.

6. Rising Urbanisation

Indias towns and cities are expected to house around 600 million people by 2036, accounting for about 40% of the population, up from 31% in 2011, while contributing nearly 70% to GDP. As more people move to urban areas, demand for organised food services such as QSRs, cafes and delivery platforms is steadily increasing. Urban consumers generally have higher disposable incomes, faster-paced lifestyles and greater exposure to global cuisines, which supports the expansion of branded food chains. At the same time, the development of urban infrastructure, including malls, high streets and transit hubs, is creating new avenues for food service operators to reach consumers.

7. Supportive Demographics

As of February 2026, over 65% of the population is under the age of 35, driving strong demand for modern consumption formats. This young, digitally connected population is quick to adopt food delivery platforms, digital payments and app-based discovery, making it a key enabler of organised, tech-led food services. At the same time, rising incomes and an expanding middle class are increasing discretionary spending on eating out and delivery, with a growing preference for convenience, variety and branded dining experiences. This is strengthening demand across quick service restaurants, casual dining and delivery- led formats.

Sources:

LFPR continued at nearly the same level, PIB, February 2026

India is far more urban in economic and functional terms than official definitions suggest: Economic Survey 2025-26, PIB, January 2026

Indias Youth Dividend in the Al Era. PIB. February 2026

Challenges in the Indian Food Service Market

1. Rising Real Estate Costs

High rental costs, particularly in prime urban locations, significantly increase operating expenses for food service businesses. These costs account for a substantial portion of overall expenditure. As a result, maintaining profitability becomes increasingly challenging.

2. Low Per Capita Spending

Per capita spending on eating out in India is still relatively low compared to many global markets. This is mainly due to a strong cultural preference for home-cooked meals and limited dining options in smaller towns. However, this trend is gradually changing as lifestyles evolve, urbanisation increases and more dining choices become available.

3. Maintaining Consistent Quality and Hygiene

Ensuring consistent food quality and hygiene standards across outlets remains a major challenge. This is especially true for smaller and unorganised players with limited resources. Any inconsistency can negatively impact customer trust and brand reputation.

4. Growth of Cloud Kitchens

The rapid expansion of cloud kitchens and quick-service restaurants is intensifying competition in the food service industry. Their cost-efficient and scalable models, along with lower capital requirements, are enabling faster expansion and attracting new entrants, putting pressure on traditional dine-in formats.

5. Health and Wellness Trends

Rising consumer awareness around health and nutrition is shifting demand towards healthier food options. This requires restaurants to continuously adapt their menus and offerings, increasing operational complexity and costs while challenging traditional menu formats.

6. Intense Competition

The growing number of food service outlets has intensified competition across all segments. Consumers have awide range of choices and are more willing to switch between brands. This makes customer retention increasingly difficult for businesses.

7. Supply Chain and Cost Pressures

Fluctuations in raw material prices and supply chain disruptions can significantly impact operating costs. Ensuring a steady supply of materials while keeping expenses under control remains a key challenge for the business. These pressures can directly affect profit margins and also influence how products are priced.

8. Geopolitical and Supply Chain Risk

Heightened geopolitical tensions and disruptions in key shipping routes may lead to volatility in fuel, edible oil and packaging material prices. As India relies significantly on imported crude oil and LPG, any disruption in global supply chains may increase energy and transportation costs. Such developments could impact restaurant operations, procurement efficiency and operating margins. Further, delays in logistics and equipment movement may affect supply chain continuity. The Company continuously monitors these risks and undertakes appropriate sourcing and operational measures to mitigate potential impact.

Indonesian Food Service Market

Indonesias food service industry has been growing rapidly, driven by changing consumer lifestyles and increased dining-out trends. In this market, Quick Service Restaurants (QSRs) represent roughly half of all dining outlets, while Casual and Fine Dining establishments together make up dose to 44%, highlighting a diverse and competitive market landscape. At the same time, technology and online platforms have made ordering food easier, boosting sates for QSRs, cafes, bakeries and other dining options. In 2024, Indonesias food services market was worth about USD 29.8 billion and is expected to grow steadily at around 2.1% annually, reaching nearly USD 33.0 billion by 2029. The regions of Java, Sumatra and Bali remain the key drivers of the countrys food service industry. Chain restaurants accounted for 12.4% of the market in 2024, valued at roughly USD 3.7 billion, up from 8.1% in 2015 and are projected to grow to USD 4.5 billion by 2029. Overall, in 2024, Fine Dining and Casual Dining restaurants accounted for the largest share, at around USD 23.6 billion, followed by Quick Service Restaurants at USD 4.1 billion and Cafes and Bars at USD 2.1 billion.

Domestic and international brands a re expanding into smaller towns and emerging urban areas, reaching more consumers. Rising health awareness has increased demand for nutritious and plant-based meals, which many brands are now offering.

1. Untapped Market Potential: Indonesias QSR density is just 143 outlets per million urban residents, far below levels in China, the USA and the UK. With chain restaurants representing only 12.4% of the market, there is considerable potential for growth, particularly in smaller cities and emerging urban areas. Expanding chains presents a strong opportunity but requires significant investment and focussed brand development.

2. Rising Disposable Incomes: Increasing urbanisation, declining poverty levels and a growing middle class are expected to boost dining-out frequency. Higher disposable incomes will encourage consumers to experiment with new cuisines and spend more across QSR, casual and fine-dining formats.

3. Expansion into Emerging Cities: While Jakarta, Bali and Surabaya remain primary markets, cities such as Medan, Makassar, Kalimantan and Bandung are experiencing growing demand. QSR brands entering these regions can capture first-mover advantages and build long-term customer loyalty.

4. Indigenous Cuisine Integration: Consumers are showing a strong interest in local and regional flavours. QSRs incorporating traditional Indonesian dishes in modern formats can differentiate themselves while supporting culinary heritage and appealing to both domestic and international diners.

5. Rise of Digital Food Delivery: The rise of online food delivery platforms, along with the adoption of mobile payments, offers scalable distribution channels. Brands can expand reach, improve convenience and enhance engagement through digital-first strategies and cloud kitchens.

1. Low Per Capita Spend: Indonesians spend less on dining out compared to major markets, especially outside top cities. This restricts revenue potential and requires brands to balance affordability with quality to attract regular consumers.

2. Concentrated Urban Growth: Growth has largely been focussed in major urban centres, leaving secondary and tertiary cities underserved. Expanding into these regions involves understanding local tastes, logistical challenges and infrastructure limitations.

3. Competitive Pressure:

Domestic and international QSR brands face intense competition, both from each other and from independent eateries. Success requires continuous menu innovation, strong digital presence and operational efficiency to retain and grow market share.

Global Quick Services Market (QSR)

The global QSR market was valued at USD 276.2 billion in 2025 and is projected to reach USD 392.3 billion by 2034, growing at a CAGR of 4.0% over 2026-2034. North America continued to lead the market with a 39.9% share in 2025, supported by strong consumer demand, a mature consumer base, high brand penetration and well-established infrastructure.

In 2025, chain and franchise outlets dominated the market, accounting for 57.0% of the total share, as they offer consistent quality and can scale efficiently across regions. Among product categories, burgers and sandwiches accounted for the largest share at 51.2% in 2025. By service type, offline channels such as dine-in, takeaway and drive-thru accounted for 57.7% in 2025, highlighting the continued importance of physical outlets.

The market is largely driven by busy urban consumers who prefer quick and ready-to-eat meals that fit into their daily routines. The growing working population has further increased the frequency of eating out and ordering food. At the same time, technology is reshaping the industry, with mobile apps, food delivery platforms, self-service kiosks and digital payments making the ordering process faster and more convenient. Consumers, especially younger groups, are also seeking more personalised and flexible meal options, encouraging brands to invest in digital tools and loyalty programmes. In addition, there is a clear shift towards healthier and more sustainable choices. Many brands are introducing plant-based and cleaner menu options while focussing on eco-friendly packaging and responsible sourcing. Continuous menu innovation and adaptation to local tastes are also helping companies attract a wider customer base and remain competitive across different markets.

Source: Global Food Service Market Size, Share. Trends & Forecast 12026-20341, IMARC Group

Indian Quick Service Restaurants

The QSR segment in India has emerged as one of the fastest- growing parts of the food service industry. The organised QSR market was valued at around Rs.787 billion in FY 2025 and is expected to grow significantly to reach Rs.1,864 billion by FY 2030, registering a strong CAGR of 18.8%.

Chain-based QSRs play a dominant role and drive growth. In FY 2025, chain QSRs accounted for nearly 58% of the total QSR market and this share is expected to remain stable at around 59% by FY 2030. The strong presence of organised chains reflects consumer preference for consistent quality, hygiene and quick service. QSR brands are increasingly adapting their strategies to better align with Indian consumer preferences to stay competitive in a rapidly evolving market. This includes offering vegetarian-only outlets in certain regions, excluding beef and pork from menus and maintaining separate preparation areas for vegetarian and non-vegetarian food. Brands are also incorporating local flavours into their offerings to better connect with regional tastes. Affordable pricing strategies, including entry-level products, are helping brands attract a wider customer base.

Indonesias Quick Service Restaurant (QSR) market is highly competitive, with both international and domestic brands driving its growth. The sector has expanded steadily in recent years, supported by the continuous entry of new players and the expansion of existing chains. There are around 63,213 QSR outlets across the country, with nearly 60% operating as part of organised chain networks. Indonesias Quick Service Restaurant (QSR) market was valued at around USD 4.1 billion in 2024, growing at a CAGR of 9.8% since 2020. The market is expected to continue expanding at a CAGR of 5.5% over the next five years, reaching approximately USD 5.3 billion by 2029. Chain restaurants accounted for about 61% of the total QSR market in 2024, a share that has remained stable since 2020. This segment grew at a CAGR of 9.6% between 2020 and 2024 and is projected to grow at a slightly slower pace of 4.4% through 2029, reaching an estimated value of USD 3.1 billion. This strong presence of global brands has also encouraged domestic players to scale up and strengthen their positions, further contributing to the markets overall growth.

Indonesias QSR market is being driven by several strong growth factors. The rapid expansion of online food delivery platforms has made ordering more convenient, while rising smartphone usage and digital payments continue to support this shift. At the same time, QSR brands are adopting flexible formats such as drive-thrus, cloud kitchens and express outlets to improve efficiency and accessibility. Growing interest in healthier and sustainable food choices, along with the localisation of menus to suit Indonesian tastes, is further strengthening consumer appeal. In addition, brands are expanding beyond major cities into smaller and emerging markets, creating new opportunities for long-term growth.

Restaurant Brands Asia Limited (hereafter referred to as RBAL or the Company) is the national master franchisee of the Burger King? brand in India, with exclusive rights to develop, operate and franchise restaurants nationwide. The Company started operations in 2014 and has since grown into a well-established QSR player. It has leveraged Burger Kings strong global brand, along with its marketing, technical and operational expertise, to build customer awareness and expand its presence. In Indonesia, RBAL operates Burger King? and Popeyes? through its subsidiaries, PT Sari Burger Indonesia and PT Sari Chicken Indonesia. Burger King? is a globally recognised QSR brand, known for its quality, value offerings and its signature flame-grilled Whopper?. As of March 31,2026, the brand has a presence in over 125 markets with approximately 20,000 restaurants worldwide.

During FY 2026, RBAL announced that Lenexis Foodworks Private Limited (Inspira Globals food and beverage arm) will acquire a controlling stake in the Company, marking the exit of its existing promoter, QSR Asia Pte. Ltd. This transaction, which includes a significant capital infusion, is aimed at supporting the Companys long-term growth in the QSR segment, subject to regulatory approvals.

India Business

RBAL delivered strong growth in its India operations during FY 2026. Revenue from operations increased by 15.45% to T22.717.23 million, compared to Rs.19,677.59 million in the previous year, supported by a same-store sales growth of 4.0% and the addition of new restaurants. The Company also reported its highest-ever EBITDA (Pre-Ind-AS 116) of Rs.1,324.22 million, reflecting a 33.24% year-on-year increase. It continued to expand its footprint by adding 68 net restaurants, bringing the total to 581 outlets as of March 31, 2026. Of these, 559 restaurants include BK Cafes?, which provide customers with a comfortable space to enjoy coffee and an expanded menu, enhancing the overall dining experience.

Indonesia Business

In Indonesia, the Company faced challenges due to geopolitical factors. BK Indonesia saw an increase in Average Daily Sales (ADS), which grew 2.8% year-on-year to IDR 18.6 million from

IDR 18.1 million in FY2025. The POPEYES? brand in Indonesia achieved an ADS of IDR 12.8 million for the same period. Popeyes Indonesia reported total revenue of IDR 117 billion in FY 2026, slightly down from IDR 139 billion the previous year. Overall, the Indonesian business reported total revenue of T5.509 million in FY 2026, compared to Rs.5,830 million in the previous year.

The Company follows a well-structured, efficient process for opening and developing restaurants, ensuring that they meet global brand standards. It focusses on people and customer experience, while also supporting its operations with a strong, integrated and scalable supply chain. The key developments during the year under review include the following:

India Business

The India business is achieving systematic growth by carefully balancing value, core and premium offerings and leveraging digital platforms and operational efficiencies. The combination of traffic growth, improved margins and strong customer engagement positions the business for long-term, sustainable success.

• Menu Strategy-Value across Layers

The India business continues to follow a clear barbell strategy, balancing value and premium offerings to attract a wide range of customers. On the entry-level side, promotions like "2 for T79/T99" and app-exclusive offers have been highly effective in driving traffic year- over-year. On the premium side, the Kings Collection 2.0, featuring high-guality burgers at Rs.200, along with guarterly limited-time offers such as the Korean burger range, strengthens the premium menu. The Company has also enhanced the core menu, creating a strong middle layer that bridges value and premium offerings and ensures a well-rounded portfolio.

• Dine-ln Focus

RBAL continues to focus on driving traffic to its dine-in restaurants. The Company has delivered steady results, with twelve consecutive quarters of positive same-store traffic growth in the dine-in business. RBAL is attracting new customers while retaining existing ones.

• Digital-First Brand

Digital adoption has been a major focus, with 97% of restaurants now eguipped with self-ordering kiosks (SOKs) and table and app-based ordering available in 100% of eligible restaurants. Around 91 % of all sales occur through digital channels, with each restaurant recording nearly one-third of dine-in transactions through the app, reflecting strong repeat engagement. Looking ahead, Al integration will further enhance customer interaction, restaurant operations and vendor partnerships, building a complete 360? technology ecosystem.

Indonesia Business

The Indonesian business is taking a structured approach by focussing on portfolio optimisation, cost control and operational efficiency. These initiatives are creating a sustainable path to profitability, reflecting Burger Kings sustained efforts to revive performance.

• Portfolio & Restaurant Optimisation

The Indonesian business has rationalised its portfolio by closing 6 additional restaurants, following 8 closures last year and continues to renegotiate rents at remaining outlets. These efforts, combined with ongoing operational improvements, are helping restaurants perform more efficiently and reduce overall overheads.

• Popeyes-Driving Awareness through Menu Innovation and Social Media

A dedicated team is working to stabilise the Popeyes business in Indonesia, which comprises 25 restaurants. The focus is on eliminating losses, optimising operations and building a sustainable growth path for this smaller portfolio.

• Menu Strengthening & Quality

The Company has completed the gaps in its chicken portfolio and enhanced its menu across restaurants. Burger King remains a strong burger brand in Indonesia, giving the business a strong platform for promotions and future growth. Menu improvements, including the addition of spicy chicken variants, cheese options and other local flavours, have successfully attracted returning customers and boosted traffic.

Category	Burger King? India	Burger King? Indonesia	Popeyes? Indonesia
*9* 1 Customer Appeal & Value	Offers a diverse menu with high-quality, innovative options tailored to local tastes. Promotions like "2 for T79/T99" and BK App exclusive offers drive traffic and appeal to valueseeking customers.	Focusses on taste, value and customer satisfaction. Highlights WHOPPER? and Bone-in-Chicken (B 1C) offerings. Enhances desserts and beverages and uses limited-time offers (LTOs) to attract customers.	Positioned as the go-to destination for chicken lovers. Offers diverse chicken varieties with unigue flavours and formats, appealing to local preferences.
Menu Selection	Several vegetarian and non-vegetarian burgers and wraps, covering all segments. Structured price ladder ensures options for all price points.	Menu includes burgers, BIC, desserts, beverages and Limited Time Offers (LTOs). Emphasis on clean food, avoiding artificial flavours, preservatives, MSG and high-fructose corn syrup.	Extensive chicken menu, prepared using the unique buttermilk system. Menu is crafted through taste testing to suit Indonesian palate.
-Q- Premium Offerings & Innovation	Kings Collection 2.0 (premium burgers at Rs.200) and limited-time offers like the Korean range.	Limited-time offers and collaborations to enhance innovation. Focus on new flavours and product variety.	Focus on chicken variety and quality.
m 1 Quality & Operations	Separate kitchens for veg and non-veg to build trust. Flame-grilled WHOPPER? using patented broilers. Clean, safe ingredients.	Standardised product assembly, workforce training and procurement efficiency ensure consistent quality. Flame-grilled WHOPPER? with high quality ingredients.	Maintains product quality with taste-tested recipes. Unique buttermilk system ensures consistent taste and texture.
	Strong digital and social media campaigns, local store marketing and app engagement.	Advertising and media campaigns guide customers through awareness, consideration and trial. Enhances visibility of new offerings.	Media investments help attract and retain customers.
Ct 1 Marketing & Engagement
if Leadership & Experience	Experienced management team with expertise in Food & Beverage, retail and Fast Moving Consumer Goods (FMCG). Core leadership stable since inception.	Seasoned QSR professionals with strong operational and industry expertise.	Experienced management ensuring strategic guidance and operational excellence.
& I Supply Chain & Distribution	Strong distribution network and fresh product supply chain to support cluster- based growth.	Reliable supply chain and distribution network to ensure fresh products and operational efficiency.	Strong supply chain supports consistent product guality across restaurants.

• Fluctuating Fuel and Commodity Prices

The Company faces frequent price changes in fuel, freight, energy and key ingredients such as palm oil, chicken, cheese and packaging materials. When these costs increase, it directly affects restaurant margins and overall profitability.

• Stringent Food Safety Regulations

Customers today are more aware and expect high standards of hygiene and food safety. In both India and Indonesia, QSR companies are expected to follow strict rules regarding food preparation, handling, cleanliness and pest control. Meeting these regulations consistently requires strong processes and continuous monitoring.

• Shortage of Skilled Workforce and High Attrition

The food service industry depends heavily on manpower. The Company faces challenges in finding skilled employees and dealing with high staff turnover. This also leads to higher hiring and training costs and, at times, may impact service quality and consistency.

? High Rental Costs

Rising rental costs, especially in malls and prime city locations, remain a major concern for the Company. High real estate expenses can affect profitability and may slow down expansion plans.

• Intense Market Competition

The food service market in both countries is highly competitive. There is strong competition from local unorganised players and from cloud kitchens focussed on delivery. While many smaller players struggle with consistency and hygiene, QSR brands have an advantage due to higher standards, processes and brand trust, which help them attract and retain customers.

Financial Review

				(Rs. in Million)
Dnrf Rs.rc	Standalone		Consolidated
rdlULUldlb	FY 2026	FY 2025	FY 2026	FY 2025
Revenue from Operations	22,717.23	19,677.59	28,226.40	25,507.20
Other income	727.26	238.93	486.18	311.65
Total Income	23,664.99	19,916.52	28,712.58	25,818.85
Less:
Cost of materials consumed	7,034.15	6,355.13	9,399.53	8,911.72
Employee benefit expenses	3,560.44	2,988.99	4,866.58	4,311.48
Finance Cost	1,687.99	1,411.42	1,893.78	1,608.89
Depreciation and amortisation costs	2,804.97	2,546.28	3,893.76	3,714.81
Other expenses	8,726.32	7,490.48	10,677.69	9,599.89
Exceptional item	1,222.52	-	22.52	-
Loss before tax expense	(1,591.40)	(875.78)	(2,041.28)	(2,327.94)
Less tax expense (current and deferred)	-	-	-	-
Loss for the year (1)	(1,591.40)	(875.78)	(2,041.28)	(2,327.94)
Total other comprehensive income/ (loss) for the year, net of tax (2)	(10.46)	(19.81)	(105.63)	(22.44)
Total comprehensive loss for the year, net of tax (1+2)	(1,601.86)	(895.59)	(2,146.91)	(2,350.38)
Controlling Interest of RBA (Equity holders of Parent)	N.A	N.A	(1,965.75)	(2,184.18)
Non-Controlling Interest (Minority Interest)	N.A	N.A	(181.16)	(166.22)
Opening balance of retained earnings	(8,364.11)	(7,488.33)	(16,379.25)	(14,217.23)
Closing balance of retained earnings	(9,955.51)	(8,364.11)	(18,250.03)	(16,379.25)

Key Financial Ratios

Particulars	FY 2026	FY 2025
Debtors Turnover (in days)1	5.12	3.95
Inventory Turnover (in days)	3.67	4.14
Interest coverage ratio (in times)7	1.36	1.06
Current Ratio (times)	1.18	1.53
Gross Debt Equity Ratio (excluding lease liability)	0.05	0.06
Operating profit margin (%)	14.95%	14.45%
Net profit margin (%)3	(7.01%)	(4.45%)
Return on Net worth (%)4	(7.19%)	(3.67%)

1. Marginal increase due to other operating income receivable

2. Working capital utilisation was higher

3. Due to exceptional item in FY 2026

4. Due to exceptional item in FY 2026

Risk	Impact	Mitigation
Operational Risks	Any gaps or inefficiencies in operations can affect food quality, hygiene standards and service levels. This may lead to customer dissatisfaction and could also impact the Companys financial performance.	The Company follows strict quality control processes that are aligned with global standards and regulatory requirements. It conducts regular training programmes for staff and carries out periodic audits to ensure high levels of food safety and operational excellence are maintained.
	Disruptions in the supply chain can impact day-to-day operations and profitability. This may lead to shortages of products, increased costs and potential loss of revenue.	The Company has built a diversified sourcing model by working with multiple suppliers for key ingredients and materials. It has also strengthened its distribution network and inventory management systems to ensure a smooth and reliable supply of products.
	Rising input costs due to inflation can put pressure on margins and overall profitability of the business.	The Company closely tracks market trends and uses its scale to negotiate better terms with suppliers. It also uses pricing strategies and menu planning to maintain value for customers while protecting margins.
Inflationary Pressures
Foreign Exchange Risk	The QSR industry remains exposed to foreign exchange fluctuations due to dependence on imported equipment, global commodities and supply chain linkages. In India, currency volatility may impact capital expenditure on kitchen equipment and technology infrastructure, while fluctuations in global prices of commodities such as palm oil and coffee may increase input costs. Additionally, higher freight and transportation costs arising from supply chain disruptions may impact restaurant operating margins.	The Company continuously monitors currency movements and adopts appropriate sourcing, procurement and pricing strategies to mitigate the impact of exchange rate volatility. The Company also focusses on supply chain optimisation, localisation initiatives and operational efficiencies to manage foreign exchange exposure effectively.
<A> Consumer Retention	Inability to attract new customers or retain existing ones in a highly competitive QSR market can lead to loss of market share and slower growth.	The Company continuously refreshes its menu with new offerings, strengthens its value proposition and improves customer experience through technology and service quality. Strong brand recall and loyalty programmes also help in retaining customers.
DM Regulatory Compliance	Failure to comply with laws related to food safety, labour and environmental standards may result in penalties, legal issues and damage to the Companys reputation.	The Company has established strong governance practices and dedicated compliance teams to ensure adherence to all applicable laws and regulations across markets.
Information Technology Risks	Cybersecurity threats or data breaches can affect systems, disrupt operations, lead to financial losses and reduce customer trust.	The Company has implemented strong cybersecurity measures such as advanced firewalls, encryption systems and regular security audits. Each restaurant operates with digital systems supported by clear data protection policies. The Company does not store sensitive customer data such as CVV or card expiry details. IT systems are actively monitored with necessary certifications and controls are in place.
Talent Management	Challenges in hiring, retaining and developing skilled employees can impact operational efficiency and slow down growth plans.	The Company has a structured hiring process and focusses on employee training, engagement and development. It promotes a culture of inclusivity, diversity and growth opportunities to attract and retain talent.
Environmental, Social and Governance (ESG) Risks	Not addressing ESG-related concerns can harm the Companys reputation, reduce stakeholder trust and impact long-term sustainability and business performance.	The Company is focussed on responsible sourcing, reducing its environmental footprint and aligning its Environmental, Social and Governance (ESG) practices and reporting with relevant standards.
Social Media Risk	Negative comments, misinformation, or inappropriate employee behaviour on social media can quickly damage the brand s image and customer trust.	The Company has implemented a clear social media policy and provides regular training to employees. It actively monitors online platforms and has crisis management protocols in place to respond quickly to any issues.
Business Continuity & Geopolitical Risks	Unexpected events such as natural disasters, pandemics, or geopolitical tensions can disrupt operations and impact financial performance.	The Company has developed comprehensive business continuity plans, including contingency measures, crisis management frameworks and disaster recovery strategies to minimise disruptions and ensure resilience.

RBAL continues to build a strong and supportive workplace where employees feel valued and motivated to grow. During FY 2026, the Company focussed on promoting a culture of openness, trust and empathy while prioritising employee wellbeing. It had a workforce of around 10,620 employees across more than 160+ cities in India. At the same time, RBAL placed strong emphasis on continuous learning and skill development to meet evolving business needs.

A Culture of Continuous Learning

The Company invests in building capabilities and preparing employees for higher responsibilities. Over the past nine years, its Rewarding Ace Performance (RAP) has played a key role in nurturing and developing talent, specifically by building a strong pipeline of Area Leads and Market Leads. RBAL continues to strengthen the skills of its frontline and operations teams so they can deliver better customer experiences and grow into leadership roles. In FY 2026, the Company also introduced behavioural training initiatives across different levels of the organisation.

RBAL places great importance on maintaining robust systems and processes to ensure smooth, compliant operations. The Company has a well-defined internal control framework to safeguard its financial data and assets. These systems help manage business risks, ensure accurate reporting and maintain compliance with regulatory requirements. All policies and procedures are clearly documented under expert supervision.

The internal control framework is continuously monitored by an internal team, along with support from external auditors, to ensure its effectiveness. The Audit Committee regularly reviews audit reports and key observations are discussed with management. In line with the Circular dated January 7, 2026 issued by the National Financial Reporting Authority ("NFRA") on Effective Communication Between Statutory Auditors and Those Charged with Governance ("TCWG"), the Board has identified the TCWG and established a framework for effective two-way communication between the Statutory Auditors and the TCWG. Based on these insights, corrective actions are taken to further strengthen processes and controls.

The Company is well-positioned to drive the next phase of growth across India and Indonesia, backed by a clear longterm vision and continuous operational improvements. In Indonesia, the Burger King business is expected to steadily move towards sustained growth, supported by rising sales, stronger dine-in momentum and a well-established chicken portfolio, while further strengthening its leadership in burgers through product innovation and sharper brand communication. Focussed actions are also underway to turn around the Popeyes business and unlock its growth potential. In India, the business is set to continue its growth trajectory, driven by consistent same-store sales, balanced store expansion and deeper digital integration that will enhance customer engagement and operational efficiency. Delivery is expected to remain a key growth driver while ongoing cost efficiencies and scale benefits are likely to further strengthen profitability. Moreover, the proposed acquisition of RBAL by Inspira Global, along with significant capital infusion, is expected to strengthen the Companys balance sheet, enhance strategic direction and support long-term growth and value creation. Overall, with a strong foundation and a balanced focus on growth, innovation and efficiency, the Company is well placed to create long-term value and deliver sustained performance in the years ahead.

The Management Discussion and Analysis may contain statements regarding the Companys goals, forecasts, assessments and expectations, which could be considered forward-looking statements under applicable laws and regulations. Actual outcomes may differ materially from those expressed or implied in these statements due to various factors. Therefore, investors are encouraged to conduct their own evaluations and consider all relevant factors before making any investment decisions.