Buy Bikaji Foods International; target of Rs 900: Motilal Oswal

buy

Motilal Oswal's research report on Bikaji Foods International

We interacted with the management of Bikaji Foods International (BFL) to gain insights into the evolving trends across BFL’s business segments and its growth outlook. Below are the key highlights from our discussion. Distribution expansion remains the key growth lever for BFL, with numeric distribution at ~60% in core states and ~5% in focus markets. Growth in Rajasthan (~90% weighted distribution) will be driven by higher throughput per store, while states like Bihar, Assam, UP, Punjab, and Haryana will contribute through outlet expansion, with the company targeting ~50k direct outlet additions annually. Management expects ~12%+ growth in core states and ~18% in focus states, supported by A&P campaigns such as “Bhujia Ho To Bikaji” and “Kya Baat Hai Ji,” with marketing spends of ~2-2.5% of revenue.

Outlook

BFL is set to deliver industryleading growth, with a CAGR of 15% in revenue, 29% in EBITDA, and 39% in PAT (excluding PLI) over FY25-28. We reiterate our BUY rating with a DCF-based TP of INR900 (based on an implied P/E of 55x on FY28E).

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Bikaji Foods International - 1103026 - moti