Britannia shares jump 4.6% after Q1 results; input cost volatility remains key monitorable

Shares of Britannia Industries, a leading food products company, rallied on Friday, August 7, following the company's June quarter (Q1 FY27) earnings release on Thursday post-market hours.

The stock jumped as much as 4.64% to ₹5,655 on the NSE in the early trade.

The standalone sales for the quarter grew 10% over the same period last year.

What the CEO said

Rakshit Hargave, Chief Executive Officer & Managing Director, said, “The year started with West Asia conflict, leading to a steep increase in cost of fuel and shipment charges across our domestic & international businesses, which we’ve been able to navigate well during this quarter delivering a healthy volume and value growth while also gaining ground against competition, with profits growing ahead of topline in doubledigit over last year."

Hargave added, "Most key categories saw positive sequential momentum as we exited the quarter with mid-teens revenue growth, anchored by rapid scaling in e-commerce and robust growth in General Trade, aided by higher advertisement, influencers & promotion spends."

The CEO further said that while the company continues to closely monitor the evolving geopolitical situation in West Asia and crude oil volatility for potential impact on international operations and domestic input costs, it will remain agile in its actions to deliver healthy, sustainable revenue growth amidst an improving domestic demand environment, driven by sharp innovation, strong brand investments, and disciplined margin management through accelerated cost efficiency initiatives.

What analysts said

Macquarie

Macquarie said the company's Q1 earnings missed estimates, primarily due to higher other expenses. However, it noted that Britannia exited the quarter with mid-teens sales growth and liked the management's commentary indicating improving domestic demand and market share gains against competitors.

Morgan Stanley

The investment firm said Britannia reported mid-teens top-line growth in Q1, while margins came in below expectations. It highlighted that most key categories witnessed sequential improvement in growth, with the company exiting the quarter with mid-teens revenue growth. It added that although margins missed estimates, management's commentary on improving growth towards the end of the quarter was a key positive.

JPMorgan

Analysts at JPMorgan said revenue growth improved during the quarter, but margins fell short of expectations. It added that input cost volatility remains a key monitorable.

Goldman Sachs

Goldman Sachs described the quarter as largely in line with expectations and highlighted the company's improving growth trajectory, particularly towards the end of the quarter.