DEVYANI PLANS TO SET UP RESTAURANTS UNDER OWN BRAND

Devyani International, Indian franchisee for global chains Pizza Hut, KFC and Costa Coffee, is setting up its own branded restaurant chains across the country and food outlets at airports.
The Rs 250-crore company is planning three restaurant chains under its own brands— Southern Spirit, Curry Republic and Oriental Cuisine—that will serve south Indian, north Indian and Chinese cuisine, respectively.
“The portfolio expansion from serving international cuisine to local food is aimed at broadcasting our business,” said Raj Gandhi, president and group CFO of holding company RJ Corp.
The company recently signed a 60: 40 joint venture with airport operator GMR to set up food outlets at Delhi airport’s international terminal.
The Ravi Jaipuriaowned group is also the biggest bottler of PepsiCo beverages and owns Cream Bell ice-cream.
Devyani has gained sufficient expertise in running food joints after the company set up the first franchisee outlet in January 1997 for Pizza Hut. The company now wants to test waters with its own brands, beginning with Southern Spirit.
“The plan is to set up 100 Southern Spirit restaurants over 4-5 years, starting with the national capital region. Our focus initially will be on Southern Spirit,” said Virag Joshi, CEO of Devyani International, which plans to invest Rs 300 crore across all its brands in the next five years.
These restaurants have been targeted at the mass market, which makes Devyani confident of turning in profits soon. “We feel the timing is right. Beverages sales are at a high, as is the case with PepsiCo. Overall, the economy is on the verge of a recovery,” Mr Gandhi said.
The increasing air travel by Indians presents a lucrative business opportunity at the airports that hasn’t gone unnoticed by Devyani. Even before signing the joint venture with GMR for food outlets at the Delhi international airport, the multi-restaurant chain set up a food court at Delhi airport’s domestic terminal 1D. It will soon open a 24-hour bar at domestic terminal 1C. The food court serves all the group’s brands: Pizza Hut, KFC and Costa Coffee specialties, Pepsi-Co beverages and Cream Bell ice-cream.
“The food court is being run as a single entity and serves a combination of our locally-created brands and international ones for which we are the franchisees. We will replicate this model at other airports, malls and other institutional areas,” Mr Gandhi said.
The company has also bid for similar food courts at Jaipur, Amritsar and Chandigarh airports.
Courtesy:- ET dt:- 29-09-09