Westlife Development draws up Rs 750-crore expansion

Plans to double McDonald's restaurant network to 500 in west, south India over the next five years

Westlife Development Limited (WDL), the parent company of fast food multinational McDonald's west and south India franchisees, Hardcastle Restaurants Private Limited (HRPL), has embarked on a Rs 750-crore expansion plan aimed at doubling the number of McDonald's restaurants from the present 230, in the next five to six years.

"The expansion, which includes reimaging of outlets and opening in-store McCafes, will be funded through internal resources. WDL currently has Rs 160 crore in cash and cash equivalents on its books, besides healthier cash inflows from its business. We don't anticipate any external capital at least in the foreseeable future," WDL vice-chairman, Amit Jatia, told mediapersons on Wednesday.

HRPL, which merged with its parent in July 2013, serves around 180 million customers every year. It has invested close to Rs 1,000 crore in building the McDonald's outlet network across 29 cities in the western and southern states over the last 20 years. WDL has reported revenues of Rs 760 crore in the 2014-15 financial year, and expects Rs 850 crore in revenues in the current financial year.

According to Jatia, the western fast food market in India is currently pegged at $1 billion and McDonald's expects this to grow four-fold in the next one decade.

Stating that HRPL has recently partnered online food-ordering platform Foodpanda for delivery services in west and south India, Jatia said that food orders through their online portal and mobile app comprised a little over 40 per cent of HRPL's total deliver business.

Westlife Development's scrip ended the trade at Rs 223.60 on the BSE on Wednesday, down 4.69 per cent, over the previous close of Rs 234.60 per share.