Moneycontrol PRO

Hold Britannia Industries; target of Rs 4000: Sharekhan

Sharekhan recommended Hold rating on Britannia Industries with a target price of Rs 4000 in its research report dated August 04, 2022.

August 06, 2022 / 10:39 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Sharekhan's research report on Britannia Industries


Britannia Industries (Britannia) Q1FY2023 performance lagged ours as well as street’s expectation with revenues growing by 9% (volumes fell 2%); higher input prices and ad-spends dragged OPM by 274 bps to 13.5%. With a ~20% price hike in the product portfolio, recovery in biscuit sales volumes will take time. In the medium term we expect volume growth to hover at 6-8% led by distribution expansion (especially in Hindi-speaking towns), market share gains and good traction to new launches. Company saw some weakness in the key input prices (including wheat and palm oil) at fag end of the quarter. Management expects margins to bottom-out in Q2 and will improve from H2FY2023 with a consistent fall in commodity prices and benefits from cost efficiency measures.



Outlook


Britannia’s stock price has run-up by 17% from its recent low and currently trading at 55.9x/44.5x its FY2023/24E EPS. We downgrade our rating on the stock to Hold from Buy with an unchanged PT of Rs. 4000.

Close

For all recommendations report, click here


Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Britannia Industries - 050822 - khan

Broker Research
first published: Aug 6, 2022 10:39 pm
Sections
ISO 27001 - BSI Assurance Mark