Britannia Inds hits record high on buzz of putting bakery unit on block

Britannia Industries jumped 4% to Rs 951.55 at 13:40 IST on BSE on a media report that the company is in talks to sell its bakery foods subsidiary Daily Bread four years after the acquisition.

Meanwhile, the BSE Sensex was down 28.83 points, or 0.14%, to 20,739.05.

On BSE, 51,000 shares were traded in the counter compared with average volume of 29,896 shares in the past one quarter.

The stock hit a high of Rs 972.50 so far during the day, which is also a record high for the counter. The stock hit a low of Rs 917 so far during the day. The stock hit a 52-week low of Rs 400 on 7 November 2012.

The stock had outperformed the market over the past one month till 23 October 2013, rising 22.86% compared with the Sensex's 4.36% rise. The scrip had also outperformed the market in past one quarter, gaining 25.96% as against Sensex's 2.29% rise.

The large-cap biscuits major has an equity capital of Rs 23.97 crore. Face value per share is Rs 2.

According to the report, Britannia Industries is in a process to sell its bakery foods subsidiary Daily Bread four years after acquiring the gourmet retailer.

Britannia, under the leadership of Vinita Bali, bought Daily Bread as part of a diversification plan in 2009. Daily Bread has a network of 31 stores and cafes across Bangalore, Hyderabad and Goa selling European-styled specialty breads, cakes, pastries, muffins and salads. With three manufacturing facilities, Daily Bread is also a lead supplier to KFC, Domino's, CafCoffee Day and multiplex chains.

Report said that Britannia Industries has struggled in scaling up neighborhood business model of Daily Bread competing in a heavily fragmented bakery market. Britannia is exploring all options with sale being the preferred plan for Daily Bread, report added.

Britannia Industries' consolidated net profit jumped 93% to Rs 89.50 crore on 14% growth in revenue to Rs 1539.60 crore in Q1 June 2013 over Q1 June 2012.

Britannia said its operating margin at 7.7% in Q1 June 2013, increased significantly from 4.7% in Q1 June 2012, despite an increase in brand investment at 9.6% of revenue in Q1 June 2013 from 8.4% of revenue in Q1 June 2012.

Britannia Industries makes biscuits, bread, rusk, cakes and dairy products like cheese, butter and milk.

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