India’s consumption story is showing clear splits this quarter, with premium alcohol and beauty leading growth while quick-service restaurants (QSR) continue a slow, uneven recovery, according to a Q4FY26 preview by Elara Capital.

The brokerage expects “diverging trends” across segments, with alcobev growth increasingly driven by realisations rather than volumes, even as beauty and fashion retail sustain strong momentum. QSR, meanwhile, is stabilising but still grappling with demand volatility and cost pressures.

“Volume growth trend diverges in alcobev,” said Karan Taurani, executive vice president at Elara Capital, highlighting how premiumisation is shaping outcomes within the sector. 

Premium drives alcobev, pressure persists in pockets

Within spirits, the contrast is sharp. Radico Khaitan is expected to post strong premium-and-above (P&A) volume growth of around 21% year-on-year in Q4FY26, driven by vodka and broad-based traction. However, value growth is likely to remain modest at 2–3%, indicating that pricing and mix and not volumes, are doing the heavy lifting. EBIT margins are seen expanding to about 18%. 

In comparison, United Spirits may see a 1% decline in P&A volumes, dragged by duty hikes in Maharashtra and a steep 15% drop in the popular segment. Even here, realisation-led growth of 3–4% could partially offset the weakness, with margins inching up to 17.4%. 

Beer is showing early signs of recovery, with United Breweries likely to report 4% volume growth, though margin pressure persists due to inflation in glass (15–20%) and cans. 

Also read: QSR chains stay open amid LPG concerns, but Swiggy and Zomato may feel the pinch

QSR recovery steady but uneven

In QSR, same-store sales growth (SSSG) is expected to hold, but the recovery remains fragmented across formats.

Jubilant FoodWorks is likely to lead with like-for-like growth of around 4% (or 5% adjusted for LPG disruptions), while Pizza Hut operators such as Devyani International and Sapphire Foods may continue to lag, with SSS declines of 4% and 8%, respectively. 

Burgers and fried chicken chains are seeing better traction. Restaurant Brands Asia (Burger King India) may post around 5% SSSG, while KFC operators could see about 4% growth, aided by aggressive value offerings. 

“SSSG recovery momentum should sustain across QSR chains, except for Pizza Hut,” Taurani shared, adding that LPG supply disruptions remain a near-term operational risk despite mitigation efforts. 

Margins, however, are diverging. Jubilant FoodWorks is expected to maintain a strong EBITDA margin of about 20.4%, while peers such as Sapphire and Devyani may see compression due to higher costs and continued investments. 

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Fashion and beauty continue to outperform

Outside food and beverages, discretionary retail remains a bright spot.

Trent’s standalone sales are expected to grow about 18% year-on-year, supported by a 24% expansion in its store network, including 957 Zudio stores and 300 Westside outlets. Margins are also improving, with gross margin seen at 45%. 

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Nykaa is set to sustain its strong run, with overall sales growth pegged at 26.5% year-on-year. Its beauty and personal care (BPC) segment is expected to see GMV growth of around 24–26%, while fashion GMV may rise about 25%. EBITDA margin is likely to inch up to 8.1%, aided by lower losses in the fashion business. 

What this quarter shows is a consumption story that is no longer uniform. Premium categories and discretionary retail are holding up, but mass segments, especially in QSR and parts of alcobev, are still under pressure owing to the geopolitical uncertainty, making growth increasingly dependent on pricing power, product mix, and execution.