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Subway India’s IPO Plans Accelerate Shift Toward Company-Owned Stores
EverBrands India runs Subway stores in India and nearby countries.
It is preparing for a Rs 600-crore IPO.
The company is buying stores from franchisees and running more stores itself.
This lets EverBrands keep more money from each store’s sales.
However, it must also pay more for rent, employees, equipment, and delivery.
Company-owned stores increased to 678 out of 1,008 stores in India.
The IPO would help fund 460 more company-owned stores.
EverBrands also has targets to expand the Subway network across India, Sri Lanka, and Bangladesh.
The expansion may improve store profits, but it has also increased costs and losses.
EverBrands India bought 101 franchisee-run Subway stores in FY26.
Company-owned outlets reached 678 of India’s 1,008 stores by March-end.
The company plans to use Rs 326.9 crore from its IPO for 460 stores.
Company-owned stores offer higher economics but increase rent, staffing, and capital costs.
EverBrands’ net loss more than doubled to Rs 58.2 crore in FY26.
- Who
- EverBrands India, the master franchisee for Subway in India, Sri Lanka, and Bangladesh.
- What
- EverBrands is pursuing a Rs 600-crore IPO while shifting Subway India toward company-owned stores.
- Where
- The stores are primarily in India, within a wider master-franchise territory covering Sri Lanka and Bangladesh.
- When
- The ownership shift accelerated in FY26; proposed store expansion is planned for FY28 and FY29.
- Why
- Company-owned stores provide a larger share of store-level economics, although they also create higher operating and capital costs.
Case for Company Ownership
Risks of Company Ownership
Store economics
Case for Company Ownership
Company-owned stores allow EverBrands to capture store-level operating profit estimated at 13-15% of sales, rather than retaining about 2% of sales from franchised stores.
Risks of Company Ownership
The company must take on rent, staffing, store investment, operating expenses, and delivery costs that franchisees previously carried.
Expansion strategy
Case for Company Ownership
IPO proceeds can finance 460 additional company-owned stores and support the network’s required growth.
Risks of Company Ownership
Expansion has increased lease liabilities and contributed to a net loss that more than doubled to Rs 58.2 crore in FY26.
Growth outlook
Case for Company Ownership
Same-store sales at company-owned stores grew 6.2% in FY26, outperforming the comparisons cited in the industry report.
Risks of Company Ownership
Subway stores generate lower average daily sales than McDonald’s stores, and higher delivery and aggregator costs weigh on revenue.
Key facts
- IPO size
- Rs 600 crore
- IPO store expansion
- Rs 326.9 crore is earmarked for 460 company-owned stores in FY28 and FY29.
- Current India network
- 1,008 stores, including 678 company-owned and 330 franchisee-run outlets.
- Stores acquired
- EverBrands bought 188 franchised stores for Rs 150.3 crore, including 101 in FY26.
- FY26 company-owned sales
- Sales rose 57% to Rs 611.5 crore.
- FY26 net loss
- Rs 58.2 crore, up from FY25.
- Network obligation
- The master franchise agreements require more than 2,500 stores across India, Sri Lanka, and Bangladesh by 2031.
Sources
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