Restaurant Brands Asia Limited

Consumer Cyclical — Restaurants · NSE

₹92.60+₹0.96 (+1.05%)

DalalBaazaar Score

36 / 100

🔴 Weak

Verdict

CAUTION

Risk

Very High

Driven by high debt relative to equity, short-term liabilities exceed short-term assets, negative free cash flow.

In simple words: The company is currently losing money, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:58 pm

Understanding the Business

Company site ↗

The 60-second version of Restaurant Brands Asia Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Restaurant Brands Asia Limited, together with its subsidiaries, operates quick service restaurant chains in India and Indonesia.

IndustryRestaurants

SectorConsumer Cyclical

Employees10,620

Annual revenue₹2,801 Cr

How does it make money?

Turns over ₹2,801 Cr a year. Of every ₹100 of sales, about ₹-7 reaches shareholders as profit, with ₹13 left at the operating level before interest, tax and depreciation. Each of its 10,620 employees supports ₹26.4 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹26.4 lakh

Who are its competitors?

The closest listed comparisons in its industry are MARUTI SUZUKI INDIA LTD., TITAN COMPANY LIMITED, TRENT LTD, AVENUE SUPERMARTS LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of -0.6% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE25.9%

What is the outlook?

5 analysts covering the stock expect revenue to grow about 41.4% and earnings to grow about 260.0% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+41.4%

Est. earnings growth+260.0%

Analysts5

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +37% while net margin moved -38% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+37%

Margin effect-38%

DalalBaazaar Score

36/ 100

Weak

Weighted across six categories. Every point is explained below.

✗ Return on equity is negative

Quality vs. Valuation

Company Quality

38/ 100

Weak

How good the business is, ignoring the share price entirely.

Valuation

26/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

Weak on business quality and not cheap enough to compensate.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

23.8x

PEG

—

What's Good / What's Bad

🟢 What's Going Well2

Margins are improving
EBITDA margin is up from 6.4% to 12.8% over 3 years.
Return on capital is rising
ROCE has improved from -7.2% to -0.6%.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

8 items require attention · 6 high · 2 watch

🔴Debt has risen sharplyFinancial
Total debt is up 68% over 3 years, from ₹1,168 Cr to ₹1,967 Cr.
🔴High leverageFinancial
Debt/Equity of 2.86x — earnings must service borrowings before shareholders see anything.
🔴Thin interest coverageFinancial
Operating profit covers interest only -0.1x — little room if earnings dip.
🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🔴The company is lossmakingFinancial
Net profit of -₹187 Cr in the latest reported year.
🔴Receivables growing faster than salesFinancial
Receivables up 174% against revenue up 37% — sales are being booked faster than they are collected.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹70 Cr in the latest year.
🟡Short-term liquidity is tightFinancial
Current ratio of 0.50 — near-term obligations exceed near-term assets.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 6.4% to 12.8%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

The debt load needs earnings to hold up
Debt is 5.5x EBITDA. At that level a downturn in earnings turns a manageable balance sheet into a refinancing problem, and lenders get paid before shareholders.
Sales are being booked faster than collected
Receivables are up 174% against revenue up 37%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Size brings its own risk
Small Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
6 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 8% a year✓ 11.0% CAGR
Latest reported year was 17.9%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 11%✓ 12.8%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA falls below 3x✗ 5.5x
Already stretched, so this is a reduction target rather than a level to hold. Around 3x is where lenders typically start attaching conditions.
4Free cash flow remains positive✗ -₹70 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ -0.1x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

5 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✗ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

2 good · 2 neutral · 7 weak

Market Cap

₹6,595 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

7.49x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹-2.94

Loss-making

Negative earnings per share — the business is losing money

ROE

-25.9%

Weak

Weak capital efficiency

ROCE

-0.6%

Weak

Low return on total capital employed

Debt/Equity

2.86x

High

High leverage

Revenue Growth (YoY)

17.9%

Healthy

Healthy top-line growth

Profit Growth (YoY)

13.5%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹70 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

578.8x

Operating Margin

-0.4%

Weak

Thin margins leave little room for error

Net Margin

-5.9%

Weak

Very little revenue reaches the bottom line

Current Ratio

0.50

Tight

Tight short-term liquidity

Beta (vs Nifty)

0.42

Defensive

Steadier than the market

52W Range Position

66%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

92.9 / 96.3

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

49.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,049 Cr	₹2,412 Cr	₹2,533 Cr	₹2,801 Cr	+11.0%
EBITDA	₹132 Cr	₹269 Cr	₹282 Cr	₹359 Cr	+39.6%
EBITDA Margin	6.4%	11.2%	11.1%	12.8%	—
PAT (Net Profit)	-₹221 Cr	-₹218 Cr	-₹216 Cr	-₹187 Cr	—
EPS	₹-4.48	₹-4.4	₹-4.33	₹-3.19	—
ROE	-26.8%	-34.8%	-23.8%	-25.9%	—
ROCE	-7.2%	-4.6%	-2.7%	-0.6%	—
Total Debt	₹1,168 Cr	₹1,430 Cr	₹1,832 Cr	₹1,967 Cr	+19.0%
Free Cash Flow	-₹228 Cr	₹64 Cr	₹73 Cr	-₹70 Cr	—

🟢 Revenue has grown at 11.0% a year over 3 years.

🟢 EBITDA has grown at 39.6% a year over 3 years.

🟢 EBITDA Margin has risen from 6.4% to 12.8% over 3 years (+6.4 pts).

🟡 ROE has held roughly flat at -25.9% over 3 years.

🟢 ROCE has risen from -7.2% to -0.6% over 3 years (+6.6 pts).

🔴 Total Debt has grown at 19.0% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3,382 Cr

Total Liabilities

₹2,694 Cr

Cash & Equivalents

₹31 Cr

Operating Cash Flow

₹303 Cr

Capex

-₹372 Cr

Shareholding (proxy)

Institutional Holding

30.9%

Insider Holding

48.3%

Analyst Consensus

Recommendations

10 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹100.2

+8.2% vs CMP

Target Range

₹86 – ₹125

Peer Comparison

Company	P/E	ROE
MARUTI SUZUKI INDIA LTD.	25.2x	13.4%
TITAN COMPANY LIMITED	68.5x	36.7%
TRENT LTD	87.2x	25.9%
AVENUE SUPERMARTS LIMITED	69.9x	12.7%

Recent News

3 mixed3 general

Restaurant Brands Asia (NSEI:RBA) Stock Forecast & Analyst Predictions

Simply Wall Street, 09 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Restaurant Brands Asia Share Price News After 5.19% Gain

Univest, 14 Oct

Restaurant Brands Asia shares surge nearly 20% on strong Q1 results. What Motilal, other brokerages said

The Economic Times, 04 AugPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Restaurant Brands Asia zooms 16% as loss narrows in Q1. More gains ahead?

Business Standard, 04 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Restaurant Brands Asia (RBA) Share/Stock Price Live, NSE

TechGraph, 09 Oct

Open offer for Restaurant Brands Asia at ₹70.39 per share

scanx.trade, 20 May

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongGrowth

MiddlingBusiness Quality · Risk

WeakFinancial Health · Profitability · Valuation

Points for each in the Score ↑

Weak on the fundamentals

Poor scores on business quality without a price low enough to compensate. There is no obvious argument for owning this over a stronger company at a similar valuation. 6 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA falls below 3x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑