Marie Gold maker Britannia Industries will share its earnings report for the three months ended December on February 6, 2025. The biscuit maker will see a degrowth in net profit as the quarter was impacted by price hikes and subdued consumption environment.
According to a Moneycontrol poll of seven brokerages, Britannia Industries is likely to report a 5.1 percent revenue growth at Rs 4,488 crore. Net profit is likely to come in at Rs 562 crore from Rs 559 crore from the corresponding quarter last year, falling six percent on-year.
Earnings estimates of analysts polled by Moneycontrol are in a narrow range, so any positive or negative surprises may elicit a sharp reaction in the stock. Even the most optimistic estimate sees Britannia’s net profit falling marginally, while the most pessimistic projection sees an 11 percent on-year fall.
What factors are impacting the earnings?
Britannia Industries is likely to see lower volumes growth compared to H1, while margins take a hit on high commodity inflation.
Price Hikes: In the last inflationary cycle, the company had effected healthy price hikes, which was retained despite easing in raw material prices. Though the company has reacted late with price cuts to revive volume growth, Emkay Global see that further round of price hikes will be negative for volumes.
Volume Growth: Volumes are likely to grow between 4-5 percent, lower than the previous quarter as a result of cuts in grammage, along with inflation-led price hikes taken of around 2-3 percent.
Margins: The EBITDA margin is likely to be impacted by high agri commodity prices, particularly in edible oils, wheat and milk. Further, the lack of operating leverage is also likely to have an impact. HDFC Securities added that the EBITDA margin to see significant contraction despite strong volume growth owing to price correction as well as brand equity investments.
What to look out for in the quarterly show?
Analysts will closely monitor demand in metro areas as Britannia Industries reported a significant impact from waning urban consumption in the September quarter. Experts will also pay attention to raw material prices and their effect on EBITDA margins, as well as the heightened competitive pressure from unorganized players.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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