Britannia Industries surges 10% on upbeat volume in March quarter

The company delivered robust top-line growth of 15 per cent and a mid-single digit volume growth in March quarter (Q4FY22).

Shares of Britannia Industries surged 10 per cent to Rs 3,590.85 on the BSE in Wednesday’s intra-day trade, after the packaged foods company reported better-than-expected volume growth in the base business. The company posted volume growth at around 4 per cent in March quarter (Q4FY22), beating analyst estimates of 1 per cent. Meanwhile, the board has recommended a dividend of 5650 per cent i.e. Rs 56.5 per share.

However, at 09:37 AM; the stock erased its partial intra-day gain and was up 4 per cent at Rs 3,412. In comparison, the S&P BSE Sensex was down 0.05 per cent at 56,948 points.

The country’s leading food company reported consolidated sales growth of 15 per cent year on year (YoY) at Rs 3,508 crore and consolidated operating profit growth of 10 per cent YoY at Rs 499 crore for the quarter. However, consolidated gross margin contracted by 240 basis point (bp) YoY to 38 per cent. The lower staff cost or other expenses (-50bp/-120bp YoY) drove 60bp contraction in EBITDA margin to 15.5 per cent. 

Meanwhile, the company delivered robust top-line growth of 15 per cent and a mid-single digit volume growth. “The economy was impacted by global geo-political factors which caused further surge in inflation this quarter. We continued to take price increases judiciously and remained aggressive on cost front. We shall further take calibrated price increases and drive cost leadership to manage profitability,” the management said.

Brokerage firm Motilal Oswal Financial Services believe that a resilient brand and strong execution helped Britannia deliver mid-single digit volume growth in Q4FY22. "Besides that, the growth in the organized trade channels remained robust and the new dairy greenfield factory is on track for commercialization over the next few months," the brokerage firm added.