1. At a Glance
McDonald’s India (West & South) franchisee just posted Q1 FY26 Net Profit of ₹1.23 Cr on revenue of ₹657 Cr. That’s less than what a McAloo Tikki costs in Bandra. Valued at ₹12,116 Cr with a P/E of 1,197. This isn’t a growth stock — this is a hope stock.
2. Introduction with Hook
If McDonald’s sold optimism instead of fries, Westlife’s investors would be obese. You’ve got a stock trading at 20x Book Value and 1,197x earnings — that’s not valuation, that’s delusion in a sesame bun.
- Q1 PAT: ₹1.23 Cr (down 62% YoY)
- OPM: Slipped to 12.97% (from 16.95% last year)
And yet, it’s still serving up investor loyalty with extra fries.
3. Business Model (WTF Do They Even Do?)
Westlife = McDonald’s (West + South India), minus the Golden Arches on balance sheet.
Their moneymakers:
- 319 McDonald’s outlets
- 223 McCafé corners
- 10,000 employees
- Zero ownership of McDonald’s IP — just rights to flip patties
Essentially, they’re a real-estate-hungry QSR operator juggling real estate leases, delivery margins, and teenage staff with ketchup-stained uniforms.
4. Financials Overview
| FY | Revenue (₹ Cr) | EBITDA (₹ Cr) | PAT (₹ Cr) | OPM % |
|---|---|---|---|---|
| FY23 | 2,278 | 382 | 112 | 17% |
| FY24 | 2,392 | 377 | 69 | 16% |
| FY25 | 2,491 | 320 | 12 | 13% |
| Q1 FY26 | 657 | 85 | 1.23 | 12.97% |
Commentary:
- Growth? More like slow-cooked.
- Margins dipping like fries in mayo.
- PAT has fallen off the Happy Meal cliff.
5. Valuation
| Method | Assumption | FV Range |
|---|---|---|
| P/E (Fair) | 50–70x on normalized EPS ₹5 | ₹250 – ₹350 |
| EV/EBITDA | 20–25x on FY26E EBITDA ₹350 Cr | ₹700 – ₹875 |
Current Price: ₹777
Actual P/E: 1,197 — which is just a polite way of saying “no earnings, but vibes only”.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26: Revenue ₹657 Cr, Net Profit ₹1.23 Cr
- Added 9 new stores this quarter — because “more outlets = more opportunity to lose money faster.”
- Interim dividend of ₹0.75/share — generous, considering earnings are missing.
- ESOPs granted — because you gotta reward the team somehow.
- Expansion continues in Tier 2/3 cities, as if fries are immune to inflation.
7. Balance Sheet
| Metric | FY24 | FY25 |
|---|---|---|
| Equity Capital | ₹31 Cr | ₹31 Cr |
| Reserves | ₹557 Cr | ₹572 Cr |
| Borrowings | ₹1,363 Cr | ₹1,623 Cr |
| Total Assets | ₹2,286 Cr | ₹2,608 Cr |
Observations:
- Leverage is growing faster than net profit.
- Capital employed? Significant. Return? Underwhelming.
- Net worth is being diluted by real estate obsession.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹349 Cr | ₹-265 Cr | ₹-98 Cr | ₹-15 Cr |
| FY24 | ₹340 Cr | ₹-185 Cr | ₹-149 Cr | ₹6 Cr |
| FY25 | ₹345 Cr | ₹-221 Cr | ₹-79 Cr | ₹45 Cr |
Conclusion:
Solid operational cash — thanks to pre-paid burgers and high footfall.
But investing cash flow is deep in red — they’re flipping burgers to build more outlets, not margins.
9. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | 2.04% |
| ROCE | 6.71% |
| PAT Margin | 0.39% |
| P/E | 1,197x |
| CMP/BV | 20.1x |
This is not “growth at reasonable price”. It’s “growth at unicorn hallucination price”.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | PAT |
|---|---|---|---|
| FY23 | ₹2,278 Cr | ₹382 Cr | ₹112 Cr |
| FY24 | ₹2,392 Cr | ₹377 Cr | ₹69 Cr |
| FY25 | ₹2,491 Cr | ₹320 Cr | ₹12 Cr |
| Q1 FY26 | ₹657 Cr | ₹85 Cr | ₹1.23 Cr |
Analysis:
- PAT fell 82% in 2 years.
- This isn’t margin erosion. It’s margin extinction.
11. Peer Comparison
| Company | CMP | P/E | Revenue (TTM Cr) | PAT (Cr) | ROE % |
|---|---|---|---|---|---|
| Jubilant Food | ₹659 | 191 | ₹8,142 | ₹228 | 10.7% |
| Devyani Intl. | ₹175 | NA | ₹4,951 | ₹-10 | -0.9% |
| Sapphire Foods | ₹344 | 633 | ₹2,940 | ₹17 | 1.9% |
| Westlife Food | ₹777 | 1,197 | ₹2,532 | ₹10 | 2.0% |
Verdict:
This is the Tesla of Indian QSRs — no profits, massive valuation, and somehow still trending on Twitter.
12. Miscellaneous – Shareholding, Promoters
| Shareholder | % Holding |
|---|---|
| Promoters | 56.25% |
| FIIs | 11.24% |
| DIIs | 24.03% |
| Public | 8.13% |
Takeaways:
- FIIs trimmed slightly — smart.
- DIIs added — maybe by accident.
- Public is hanging in there like that last cold fry in the pack.
13. EduInvesting Verdict™
Westlife Foodworld is a story stock — a bet on rising QSR penetration, growing young population, and India’s unstoppable love for deep-fried capitalism.
But…
With margins crashing, profits shrinking, and a 1,197x P/E, this is not “I’m Lovin’ It.” It’s “I’m Holding It… Because I Don’t Know When To Exit.”
A gourmet stock at gourmet pricing. Just don’t look at the nutritional facts.
Metadata:
Written by EduInvesting Team | 23 July 2025
Tags: Westlife Foodworld, McDonald’s India, QSR, Q1 FY26, Burgers & Balance Sheets, EduInvesting Premium
