BQ Blue's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages. These reports offer BloombergQuint's subscribers an opportunity to expand their understanding of companies, sectors and the economy
Motilal Oswal Report
Britannia Industries has been aided by a confluence of positive factors, such as high in-home consumption (biscuits constitute 82% of sales), reduction in advertisement spend, decline in material cost, and low promotional spend owing to strong demand. These are likely to drive the strongest topline growth since FY12 (18.3% in FY21E) and the highest Profit after Tax growth since FY16 (38% in FY21E).
However, this extraordinary earnings growth in FY21 presents a significant hurdle from an FY22/FY23 perspective as none of these factors present a structural positive. Furthermore, material costs could result in high volatility in earnings for BRIT, it has one of the lowest gross margins among peers (40% in FY20)
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