Harsh Ghai said Taco Bell’s beverage plan makes him bullish on the chain. | Photo courtesy of Taco Bell.
Ghai Restaurants, a multi-brand restaurant operator out of suburban San Jose, California, recently closed on a deal for 44 Taco Bell locations in the Houston market, more than doubling its presence in the brand.
The franchisee made the deal for two reasons: First, it’s good to operate Taco Bell restaurants, given its strong sales, relative lack of competition and plans to add beverages to its product mix.
“You know how well Taco Bell is performing,” Harsh Ghai, CEO of the company, said in an interview.
But there is also this: The company wants to diversify its geographic base. Ghai Restaurants operates 260 locations, including Popeyes and Burger King locations. Other than the restaurants it has now acquired in Houston, its locations are largely in California, with some in Oregon.
That’s tough for a fast-food restaurant chain operator. Ghai called the acquisition of the Houston Taco Bells “part of an effort to grow outside the West Coast and grow into more business-friendly states.”
He said that the state has a “phenomenal workforce” and cited growth in the Houston area.
Ghai is not completely dismissive of California. “We love doing business in California,” he said. He cited average-unit volumes, which are higher there than in other states. But in 2024 the state began requiring fast-food chain operators in the state to pay at least $20 an hour, a spike from which the company is still looking to recover.
“It’s been a little over two years now since that impacted us, and we’re still looking to regain the loss from EBITDA from those policies,” Ghai said, referring to earnings before interest, taxes, depreciation and amortization. “We feel that diversifying outside California is very important to balancing our portfolio.”
Ghai Restaurants is a family-owned business. Ghai’s father, Sunny Ghai, was in the hotel business in India, and married a woman from the U.K. They moved to the U.S. in 1993 and initially owned liquor stores before deciding to jump into fast food because the business is more scalable. Sunny Ghai went to work for a Burger King operator and by 1998 had his first store.
The company grew over the years and later acquired Popeyes and then Taco Bell locations. Harsh Ghai grew up in the business, starting out in the Burger King drive-thru. Harsh is now the CEO. His sister is a silent partner and Sunny Ghai remains involved.
Ghai Restaurants operated 37 locations in the Taco Bell system. The company acquired another 44 locations from the private-equity group that owns the Houston operator Mas Restaurant Group. The restaurants represent about half of Mas’s holdings in the Taco Bell system.
Taco Bell is the most valuable restaurant franchise to acquire on the secondary market. The chain’s system sales grew by 6.5% in 2025, according to Restaurant Business sibling company Technomic. That was the strongest growth among the 10 largest U.S. restaurant brands last year. But it is also far larger than any of its nearest competitors. Taco Bell is 17 times as big as the next largest fast-food Mexican chain, Del Taco.
“It’s been extremely competitive trying to acquire Taco Bells over the last 15 years,” Harsh Ghai said. But, he noted, “this is a dream portfolio. It’s a dream portfolio in a dream market.”
The chain’s growth has been consistent, he said, which justifies the substantial multiples. Indeed, outside of the second quarter of 2020—you know what quarter that was—Taco Bell has not reported a decline in quarterly same-store sales since the second period of 2016. That was a decade ago.
Taco Bell is also making its stores more efficient with kitchen improvements, including artificial intelligence, along with its efforts on the digital front to improve the chain’s loyalty program.
But what makes the Ghai family particularly bullish now is what’s coming. The operator is fully on board with Taco Bell’s beverage strategy, including the development of the Live Mas Café. The chain debuted a new lineup of cold brew coffee at its Live Mas Café locations this week, for instance, and wants to generate $5 billion in sales a year from beverages by 2030.
“I’m excited to do that,” Harsh Ghai said. What’s more, that also gets him into the beverage business without making the investment in a beverage business. “I know it’s going to happen,” he said. “I don’t need to go out and build one of the hot beverage concepts, as great as they’re doing, because I know I can do it out of Taco Bell.”
