Company Update : Britannia Industries Ltd By Motilal Oswal Financial Services Ltd
In-line revenue; pressure on margin persists
* BRIT’s consolidated revenue rose by 9% YoY to INR44.3b (est. INR43.6b).
* The company has delivered ~5% volume growth in 4Q (est. 4.5%, 6% in 3QFY25).
* Consolidated gross margin contracted by 480bp YoY to 40.1% (est. 40%) due to a rise in commodity prices.
* Employee expenses rose 1.5% YoY, while other expenses declined 11% YoY, leading to a 120bp YoY dip in EBITDA margin to 18.2% (est. of 18%).
* EBITDA was up 2% YoY to INR8b (est. INR7.8b).
* APAT was up 4% YoY to INR5.6b (est. INR5.4b).
* In FY25, net sales rose 7% YoY, EBITDA was flat YoY, and APAT increased 3% YoY.
Other key highlights
* The operating environment continues to be challenging given the rising commodity prices, changing channel dynamics, and subdued demand across FMCG categories.
* Strategic pricing actions, a nimble approach in emerging channels, and robust cost efficiency initiatives delivered ~3% savings in revenue.
* The distribution network expanded to 2.9m direct outlets.
* New launches across the product categories, such as the e-comm’s first launch of the premium range of Pure Magic Choco Frames and Winkin Cow Grow, further reinforced BRIT’s adjacent businesses.
* For FY26, BRIT will closely monitor commodity prices with a focus on driving healthy, profitable growth and strengthening its market leadership.
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