Analysts take a bite of premium QSR stocks as restaurants hike prices

Value players, or those catering to price sensitive customers, may see growth and profitability concerns, they said

Dine-in and quick service restaurant (QSR) owners are facing a double whammy of cost pressure. Raw material costs for edible oil, fresh milk, wheat, coffee, vegetables, tea, and sugar have surged up to 60 per cent year-on-year (YoY) owing to sappy supply chains and rupee depreciation/costlier imports.

Besides, the government has also suggested restaurants to inflate menu prices rather than levying ‘service charges’.

Yet, analysts remain bullish on premium QSR players as they believe any price hike taken to offset the cost pressure, may have relatively lower adverse effects of price elasticity.

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