Eateries rule out hike despite UPI MDR

Cafes, restaurants, pubs and bars in India are unlikely to raise menu prices further in the October-December quarter despite the Centre's decision to levy a 0.4% merchant discount rate (MDR) on UPI transactions above ₹2,000, according to industry insiders. Burma Burma co-founder Chirag Chhajer told reporters that consumer consumption has never been higher and the company expects its busiest season to be the most profitable one yet.

Sagar Ratna Restaurants' MD Roshan Banan said the chain raised prices by 5% due to higher input costs and won't consider another hike. The Beer Cafe's founder Rahul Singh expects the upcoming quarter will be "really healthy" for eating out, despite inflation making consumers more discerning. Restaurants are currently operating with very thin margins and cannot pass every cost increase to consumers, as it may push them away.

Massive Restaurants' MD Zorawar Kalra noted that while food inflation rose to 6% year-on-year in August, the industry continues to face pressure across ingredients, manpower and rentals. Nevertheless, eating out remains an experience-led discretionary spend with resilience in the organised and premium segments.