Why Goldman Sachs is positive on India’s QSR sector and prefers Sapphire and Devyani

India's quick-service restaurant (QSR) sector is seeing a notable recovery, with Goldman Sachs highlighting a positive turnaround in performance. For the first time in years, QSRs have gained market share in the food delivery segment, with sales growth surpassing the overall growth of aggregators like Zomato, which has reported its slowest gross order value growth in several quarters.

While Jubilant FoodWorks continues to outperform its peers, the broader QSR sector is experiencing strong delivery growth and a 4.2% increase in dine-in sales after a prolonged decline. To boost recovery, QSRs are focusing on affordability with value-driven offerings amid inflationary pressures.

Goldman Sachs favours stocks that have underperformed but hold strong potential. Their top picks include Sapphire Foods India and Devyani , citing the long-term growth story of KFC. They also like Westlife Foodworld, given its renewed focus on value and innovation.

Meanwhile, Jubilant FoodWorks has already surged 60–67% from its 52-week low, leaving limited room for further valuation gains. Given this, Goldman Sachs prefers Sapphire, Devyani, and Westlife as investment opportunities in the QSR space.

Also Read | Morgan Stanley optimistic on QSR sector, highlights Jubilant Foodworks’ strong Q3 performance