Hunger Pangs Limited, the parent company of Burma Burma Restaurant & Tea Room, reported a net loss of ₹15.37 crore in fiscal year 2026 (FY26), compared with approximately ₹50 lakh in FY25. The loss widened nearly 31 times even as revenue from operations increased 46.6% to ₹155.50 crore. The company’s draft prospectus shows that expenses grew faster than revenue as the vegetarian Burmese cuisine chain expanded its restaurant business.
The financial results arrive as Hunger Pangs prepares for a proposed initial public offering (IPO). The company has filed draft papers with the Securities and Exchange Board of India (SEBI), proposing a fresh issue of up to ₹150 crore alongside an offer for sale (OFS) of existing shares. It plans to use approximately ₹117.3 crore from the fresh issue to open 27 new company-owned restaurants by FY2029. The proposed listing could help finance expansion, but the sharp increase in losses highlights the challenge of growing a restaurant network while managing staff costs, food expenses, rent, financing and other operating commitments.
Key Takeaways
- FY26 net loss: Hunger Pangs reported a loss of ₹15.37 crore, compared with ₹50 lakh in FY25.
- Revenue growth: Revenue from operations rose 46.6% to ₹155.50 crore.
- Expenses increased faster: Total expenses climbed 61.8% to ₹175.8 crore.
- Operating performance: EBITDA increased 20.2% to ₹25.68 crore.
- Proposed IPO: The company plans a fresh issue of up to ₹150 crore and an OFS of up to approximately 2.79 crore shares.
- Expansion plan: Around ₹117.3 crore of fresh proceeds is earmarked for 27 new company-owned Burma Burma outlets by FY2029.
- Quarterly update: Hunger Pangs reported a ₹1.1 crore net profit in Q1 FY27, helped by a deferred tax credit despite a pre-tax loss.
- Listing status: The company has filed draft IPO papers; the draft filing is not the same as SEBI approval or a completed IPO.
Hunger Pangs FY26 Financial Results
Hunger Pangs recorded substantial revenue growth during FY26, but the increase did not translate into a stronger bottom line. Its net loss expanded from roughly ₹0.50 crore in FY25 to ₹15.37 crore in FY26.
Revenue from operations increased from ₹106.10 crore to ₹155.50 crore. Including other income of approximately ₹1.5 crore, total income reached around ₹157 crore.
| Financial metric | FY25 | FY26 | Year-on-year change |
|---|---|---|---|
| Revenue from operations | ₹106.10 crore | ₹155.50 crore | +46.6% |
| Total income | — | ₹157.0 crore | — |
| Total expenses | — | ₹175.8 crore | +61.8% |
| EBITDA | ₹21.35 crore | ₹25.68 crore | +20.2% |
| Net profit/loss | -₹0.50 crore | -₹15.37 crore | Loss widened nearly 31 times |
Source: Hunger Pangs’ draft red herring prospectus, as reported by Inc42. Figures are rounded.
The comparison reveals a significant gap between sales growth and expense growth. Revenue increased by approximately ₹49.4 crore, while total expenses rose substantially as the company expanded its operations.
The loss figure also needs to be considered alongside EBITDA. EBITDA, or earnings before interest, taxes, depreciation and amortisation, measures operating performance before several financing and accounting costs. It does not equal cash flow or net profit.
Hunger Pangs’ EBITDA increased to ₹25.68 crore, but its higher overall expenses and other costs contributed to the negative bottom line. The business is therefore generating a larger operating earnings base while still reporting a sizeable annual loss.
Why Did the Loss Increase So Sharply?
The main financial issue is that Hunger Pangs’ expenses grew faster than its revenue. A restaurant chain must spend on ingredients, kitchen staff, service personnel, rent, utilities, marketing, maintenance and delivery operations. Opening additional outlets can also bring higher depreciation and financing costs.
According to the draft prospectus, Hunger Pangs’ losses in recent financial years were primarily associated with restaurant expansion, higher depreciation and amortisation, and finance costs. These expenses can increase as a chain adds locations and invests in its physical network.
The figures do not, by themselves, establish that demand for Burma Burma’s food has weakened. Revenue grew strongly in FY26. Instead, the financial challenge is whether the company can turn that expansion into sustainable net profitability.
Employee costs and food expenses
Employee benefits were Hunger Pangs’ largest reported expense category, rising 53.3% to ₹50.7 crore in FY26 from ₹33.1 crore in FY25.
The increase reflects the importance of staffing in a restaurant business. Each outlet needs kitchen workers, service staff, managers and support personnel. As the network expands, the company must recruit and retain employees while maintaining consistent food quality and customer service.
The cost of materials consumed also rose significantly, increasing 51% to ₹30.4 crore from ₹20.1 crore. This category covers food ingredients and kitchen supplies needed to serve customers.
Higher spending can accompany an expanding restaurant network and greater sales. However, the company must ensure that additional revenue generates enough contribution to cover rent, staff, procurement and other costs.
| Expense category | FY25 | FY26 | Growth |
|---|---|---|---|
| Employee benefits | ₹33.1 crore | ₹50.7 crore | +53.3% |
| Materials consumed | ₹20.1 crore | ₹30.4 crore | +51.0% |
| Finance costs | — | ₹6.6 crore | +70.0% |
| Other expenses | — | ₹48.8 crore | +54.6% |
Source: Inc42’s reporting on the draft prospectus. Dashes indicate that comparable figures are not reproduced here.
Finance costs increased 70% to ₹6.6 crore, adding pressure below the operating earnings line. Other expenses rose 54.6% to ₹48.8 crore. Together, the figures show why higher sales did not automatically result in a stronger net result.
Q1 FY27 Profit Needs Context
Hunger Pangs reported a net profit of approximately ₹1.1 crore in the first quarter of FY27, with revenue from operations of ₹53.7 crore. The company also recorded EBITDA of ₹11.4 crore, representing an EBITDA margin of approximately 21.3%.
At first glance, the quarterly profit appears to mark a turnaround after the FY26 loss. However, the tax treatment is important.
The company reported total expenses of ₹55.2 crore during the quarter and received a deferred tax credit of approximately ₹1.98 crore. That credit helped turn a pre-tax loss into a reported net profit.
A deferred tax credit is an accounting item linked to the treatment of taxes across different periods. It can improve reported net profit in a particular quarter without necessarily representing an equivalent cash inflow from restaurant operations.
The quarter therefore provides a potentially encouraging operating signal through its EBITDA and margin, but it does not establish that Hunger Pangs has achieved sustained net profitability. Investors will need to examine subsequent quarters to determine whether the company can maintain its operating performance while covering financing, depreciation, taxes and other expenses.
What Is Burma Burma’s IPO Plan?
Hunger Pangs has filed a draft red herring prospectus proposing an IPO with two components: a fresh issue of shares worth up to ₹150 crore and an offer for sale of up to approximately 2.79 crore existing shares.
These components serve different purposes. The fresh issue brings new capital into the company, while the OFS allows existing shareholders to sell part of their holdings. Money raised through the OFS goes to the selling shareholders rather than to Hunger Pangs.
| Proposed IPO component | Details |
|---|---|
| Fresh issue | Up to ₹150 crore |
| Offer for sale | Up to approximately 2.79 crore existing shares |
| Planned use of fresh proceeds | New Burma Burma restaurants and general corporate purposes |
| Expansion allocation | Approximately ₹117.3 crore |
| Planned new outlets | 27 company-owned restaurants by FY2029 |
| IPO status | Draft prospectus filed; review and approvals remain pending |
The IPO’s final price band, issue dates and other offer details had not been established in the draft-stage reporting. Those details may be announced later if the offering proceeds through the required regulatory process.
The proposed issue gives the company a route to raise funds for expansion, but it should not be described as a completed fundraising or a guaranteed listing.
How the IPO Money Could Fund 27 New Restaurants
Hunger Pangs plans to use approximately ₹117.3 crore of the fresh issue proceeds to establish 27 new company-owned Burma Burma restaurants by FY2029. The remaining fresh proceeds are intended for general corporate purposes, subject to the terms of the offer.
The expansion plan is important because the company operates a specialised dining concept rather than a broad, mass-market restaurant portfolio. New outlets could extend its reach to more customers and generate additional revenue, provided each location attracts enough business to justify its costs.
Opening restaurants requires significant upfront investment. Expenses can include security deposits, interiors, kitchen equipment, furniture, hiring, training, initial inventory and pre-opening marketing. The company must also pay recurring rent, wages, utilities and maintenance after an outlet opens.
The proposed capital raise could help fund those investments without relying entirely on internal cash generation or additional borrowing. However, the financial benefit will depend on the performance of the new restaurants.
A larger outlet network does not guarantee higher profitability. If new locations take longer than expected to reach stable sales, the company may experience pressure from operating costs before the additional revenue fully develops.
Burma Burma’s Current Restaurant Footprint
Burma Burma is known for its vegetarian Burmese cuisine and premium casual-dining format. Founded by Ankit Gupta and Chirag Chhajer, the brand has built a presence in several major Indian cities.
As of July 31, 2026, Hunger Pangs operated 22 restaurants across nine cities, alongside one delivery kitchen and three warehouses.
Its existing network provides a base for the proposed expansion, but it also creates operational complexity. A multi-city restaurant business must maintain consistent recipes, ingredients, service standards and supply-chain processes across different locations.
Warehouses and a delivery kitchen can support logistics and fulfilment, although they also create costs that must be managed as the business grows.
Hunger Pangs is also considering a new restaurant brand focused on Japanese cuisine and noodle shops, with influences from Buddhist traditions. This would diversify the company’s offering beyond Burmese food, but the proposed concept should be treated as a plan rather than an established operating business.
Launching a new brand would require its own market positioning, menu development, staffing, supply arrangements and investment decisions.
The Risks Investors Should Evaluate
The financial results highlight several issues prospective IPO investors should examine.
First, revenue growth must translate into profit. Hunger Pangs increased revenue by 46.6%, but expenses grew by 61.8%. Investors will want evidence that the company can improve cost efficiency as its network expands.
Second, expansion carries execution risk. The planned 27 outlets could increase sales, but new restaurants require upfront capital and time to establish customer demand. Locations that underperform could weigh on returns.
Third, the company must manage financing costs. Finance costs increased to ₹6.6 crore in FY26. Future borrowing, interest rates and capital expenditure could affect the pace at which losses narrow.
Fourth, quarterly profitability needs to be sustainable. The Q1 FY27 net profit benefited from a deferred tax credit. Investors should distinguish that accounting effect from recurring operating performance.
Finally, IPO valuation matters. A growing restaurant brand can attract investor interest, but the eventual share price will determine how the company’s growth prospects and financial risks are reflected in the offering.
The draft prospectus and subsequent disclosures will be important sources for evaluating these factors. Investors should review the final offer documents, financial statements, risk factors and use of proceeds rather than relying solely on revenue growth or brand recognition.
The Bigger Picture
Hunger Pangs’ FY26 results illustrate the difference between scaling a restaurant business and building a consistently profitable one. Burma Burma’s revenue growth indicates expanding commercial activity, while the much faster rise in expenses and the wider net loss show the financial pressure associated with that growth. Employee costs, ingredients, financing and other expenses are all important factors in the company’s economics.
The proposed IPO is intended to help finance the next stage of expansion, including 27 additional company-owned restaurants. The plan could strengthen the brand’s presence if new outlets perform well, but it also raises the stakes for execution. The company’s longer-term success will depend on whether it can convert a larger restaurant network into sustainable earnings and cash generation.
Looking Ahead
Hunger Pangs has filed draft IPO papers, but the proposed offering still needs to progress through the regulatory process. Investors will be watching for updates on SEBI’s review, the final offer structure, the price band and the subscription timetable. The company has identified restaurant expansion as the main use of fresh capital, with ₹117.3 crore earmarked for 27 new outlets by FY2029.
The next important financial test will be whether Hunger Pangs can improve profitability as revenue grows. Stronger outlet-level performance, better cost control and lower pressure from financing and expansion expenses could help narrow losses. Until subsequent results demonstrate that progress, the FY26 loss and the tax-adjusted nature of the Q1 FY27 profit remain important considerations for investors assessing the proposed IPO.
Frequently Asked Questions
1. Who owns Burma Burma?
Burma Burma Restaurant & Tea Room is operated by Hunger Pangs Limited, founded by Ankit Gupta and Chirag Chhajer.
2. How much loss did Burma Burma’s parent report in FY26?
Hunger Pangs reported a net loss of ₹15.37 crore in FY26, compared with approximately ₹50 lakh in FY25.
3. Did Burma Burma’s revenue decline in FY26?
No. Revenue from operations rose 46.6% to ₹155.50 crore. The net loss widened because expenses grew faster than revenue.
4. How much is Hunger Pangs planning to raise through its IPO?
The draft prospectus proposes a fresh issue of up to ₹150 crore, alongside an OFS of up to approximately 2.79 crore existing shares. The OFS proceeds would go to selling shareholders.
5. What will Hunger Pangs use the IPO proceeds for?
The company plans to use approximately ₹117.3 crore from the fresh issue to establish 27 new company-owned Burma Burma restaurants by FY2029. The remaining proceeds are intended for general corporate purposes.
6. Is Hunger Pangs profitable in FY27?
It reported a net profit of approximately ₹1.1 crore in Q1 FY27, but a deferred tax credit of around ₹1.98 crore helped produce that result despite a pre-tax loss. One quarter does not establish sustained profitability.
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