HSBC has maintained hold rating on Britannia Industries but cut target price to Rs 2,850 from Rs 3,100 per share
Shares of Britannia Industries touched 52-week low of Rs 2,491, falling nearly 4 percent intraday on August 13 as brokerage houses cut the target price after company reported its June quarter numbers.
The company's Q1FY20 net profit was down 3.5 percent at Rs 249 crore against Rs 258.1 crore in the same quarter last fiscal.
Revenue rose 6.2 percent YoY at Rs 2,700.4 crore versus Rs 2,543.8 crore.
Earnings before interest, tax, depreciation and amortization (EBITDA) rose 1.4 percent at Rs 394.9 crore against Rs 389.4 crore in the year-ago, while margin declined to 14.6 percent versus 15.3 percent in Q1FY19.
The profit includes one-time loss of Rs 15.6 crore. The company's other income stood at Rs 67.4 crore versus Rs 42 crore.
Kotak Institutional Equities has retained its reduce rating on the stock and cut target to Rs 2,500 from Rs 2,800 per share.
The company has ruled out a quick recovery in demand and management commentary was sharply weaker than we have heard from other companies, said Kotak Institutional Equities.
It lowered FY20-22e EPS forecasts by 8-11 percent, while valuations, despite a sharp 20 percent plus correction from the peak, is still outside our comfort zone, it added.
HSBC has maintained hold rating on Britannia Industries but cut target price to Rs 2,850 from Rs 3,100 per share.
The company's margin contracted mainly led by a rise in input prices. The company hedged flour costs and aims to further accelerate cost savings. The valuation still builds in significant long-term growth expectations, it added.
Citi has maintained buy rating on Britannia and cut target to Rs 3,000 from Rs 3,250 per share.
The research house cut estimate by 5-7 percent factoring the results and recent trends.At 0952 hours, Britannia Industries was quoting at Rs 2,497.40, down Rs 89.80, or 3.47 percent on the BSE.