'Buy' Bikaji Foods Shares Maintains Dolat Capital Post Inline Results, Hikes Target Price — Here's Why
Bikaji Foods' posted double-digit growth of 11.2% YoY in ethnic snacks, while the packaged sweet/ western snacks/ papad segment grew by 3.1/ 4.2/ 5.8%.
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Dolat Capital Report
Bikaji Food International Ltd.'s Q1 FY26 revenue was in line, while Ebitda and adjusted profit after tax were ahead of our estimates. Revenue (inc. production linked incentive) grew by 14.2% YoY to Rs 6.5 billion, while ex- PLI, revenue grew by 14.9% YoY with 7.5% volume growth. We believe that volume growth will be the primary driver of revenue growth in the near term.
The company posted double-digit growth of 11.2% YoY in ethnic snacks, while the packaged sweet/ western snacks/ papad segment grew by 3.1/ 4.2/ 5.8%.
Though Q1 FY26 profitability was ahead, we have maintained our FY26/27E EPS at Rs 12.0/14.7 as our estimates have already factored in improvement in the demand environment.
We believe that margins would improve here on given the recent price hikes, stable raw material prices and resurgence of volume growth. Maintain ‘Buy' rating with revised target price of Rs 959 (Rs 855 earlier), valuing at 65x FY27E.
As our confidence in the business has increased, we revise the target multiple upwards.
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