Britannia Industries posted muted set of numbers for the Q1FY20; missing the estimates on operating fronts. Revenue growth for the quarter stood at 6.2% yoy to Rs2,700.4cr, broadly in-line with estimates. Gross margin for the quarter expanded marginally by 41bps yoy to 40.4%. Due to higher other expenses, EBITDA growth was restricted to just 1.4% yoy to Rs394.7cr (~8% below estimates) and EBITDA margin contracted by 69bps yoy to 14.6% (estimate 15.4%). Reported PAT declined by 3.7% yoy to Rs248.6cr on account of Rs15.6cr of extraordinary expense pertaining to voluntary retirement cost incurred in one of the subsidiaries of the company. Adjusting for that the Adj. PAT stood at 269.7cr, up 4.5% yoy; ~8% lower than estimate.
Company witnessed moderate inflation in the prices of key raw materials for the bakery business. However, the inordinate increase in milk prices impacted profitability of the dairy business adversely.
Depreciation cost was up 25.6% yoy, and interest outgo stood at Rs10.1cr against Rs2.4cr in Q1FY19.
Other income for the quarter was up by 60.6% yoy to Rs67.5cr.
Tax rate for the quarter stood at 35.1%, 74bps higher than the base quarter.
Company indicated that it has strengthened the brand equity through focused campaigns and invested in building capabilities & structures for both, base business as well as the strategic business units, to drive future growth.
Also, it has accelerated the cost efficiency initiatives amid the low growth phase in order to maintain the shape of business.
Britannia Industries Ltd ended at Rs. 2,587.20, up by 8.35 points or 0.32% from its previous closing of Rs. 2,578.85 on the BSE.
The scrip opened at Rs. 2,598.95 and touched a high and low of Rs. 2,642 and Rs. 2,523.60 respectively. A total of 15,07,438 (NSE+BSE) shares were traded on the counter. The stock traded above its 200 DMA.
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