Britannia Industries Q1 Review – Weak Operational Performance Continues: Dolat Capital

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Britannia Industries Ltd.’s revenue increased 8.7%, with ~2% volume de-growth. The company posted 11% revenue compound annual growth rate over Q1 FY20.

Britannia Industries has been consistently gaining market share over the last several quarters. Gain in rural market share was driven by dealer network expansion (27,000 versus 23,000 in FY21).

Ebitda margin contracted by 270 basis points to 13.5% primarily due to gross margin contraction and higher other expenses – lowest margin since FY16.

New product launches and brand innovations (~4.5% of sales) continue to remain the company’s focus. These new products would help reduce dependency on conventional biscuit business and create new levers for growth (contribution expected to grow to 5% in near term).

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