The United Nations World Economic Situation and Prospects 2018 estimated the Indian industry to grow at 7.2% in 2018.
The India's quick service restaurant business has struggled from demonetisation, the ban on liquor sales on highways and the introduction of the goods and services tax (GST). According to a report by The Economic Times, hundreds of QSR and cafe outlets shut between 2013 and 2016 through the reckless expansion of 2015. Now, they have bounced back, impelled by the introduction of smaller stores, more food innovations, moving out of high streets and greater focus on same-store sales growth (SSG).
For the first two quarters of fiscal 2018, Domino's made a comeback to positive 6.5% and 5.5% SSG. Profit after tax (PAT) of Jubilant FoodWorks, the master franchisee of American pizza brand Domino's and donut label Dunkin' Donuts, leaped from a meagre 6.72 crore in March 2017 to Rs 48.5 crore.
The United Nations World Economic Situation and Prospects 2018 estimated India will grow at 7.2% in 2018 and accelerate to 7.4% in the following year on robust private consumption, public investment and structural reforms, though the risk of sudden capital withdrawal on account of monetary policy normalisation in developed countries remained. An uptick in consumer sentiment and improving GDP is what the doctor ordered for an ailing food industry overwhelmingly dependent on discretionary spend.
Consumer confidence in India rose to a 10-year high in the December quarter of last year, according to Nielsen's global consumer confidence index report released in February this year. India retained its No. 1 spot among the 63 countries surveyed.
But also according to the report, in spite of the early signs of revival, food entrepreneurs are careful to temper their optimism. Getting government approvals, permissions and overall rules and regulations governing the F&B industry continue to be a big constraint, says Amit Burman, chairman of Lite Bite Foods.
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