McDonald’s India, the Indian arm of the US fast-food giant, has posted its first profit since it started operations in the country 22 years ago, reports Economic Times (ET).
As per the latest filings with the Registrar of Companies (RoC), the company posted profits of Rs 65.2 lakh during FY17-18 (April 2017 - March 2018), with revenues of Rs 119 crore.
However, it posted a loss of Rs 305 crore in the last financial year, with revenues of Rs 111 crore. Over the years, it has accumulated cumulative losses of over Rs 422 crore.
“The company has not only been able to stem any further erosion of its net worth, but has also been able to successfully reverse the trend of erosion through the infusion of fresh capital,” said McDonald’s India, in its regulatory filing.
However, the company, which started India operations in 1996, has been involved in a long-drawn legal battle with Connaught Plaza Restaurants (CPRL). The latter is McDonald’s licensee partner in North and East India.
India’s quick service restaurant (QSR) market, though small, is growing rapidly. Innovations in food products, smaller stores and moving into low-frequency locations, have helped the fast-food sector to expand.
India’s per capita expenditure is $110 when compared to US’s $1870 and China’s $750. Also, an average Indian eats out only 4-5 times in a month. However, in Singapore, the monthly frequency is 28.