Britannia Industries - Payoff On Massive Investments Could Be Immense In The Medium Term: Nirmal Bang

The company has consistently been in the top quartile among fmcg peers on all key parameters.

<div class="paragraphs"><p>Jim Jam biscuits by Britannia Industries Ltd. (Photo: Rohan Verma/Unsplash)</p></div>
Jim Jam biscuits by Britannia Industries Ltd. (Photo: Rohan Verma/Unsplash)

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Nirmal Bang Report

Key Points

  • Over each time period in the past five/10/15 years, Britannia Industries Ltd. has consistently been in the top quartile among fast moving consumer goods peers on all key parameters like sales growth, Ebitda growth and profit after tax growth.

  • Packaged foods is a category which offers immense scope for growth and Britannia Industries has been investing heavily in the past few years on expanding distribution reach, capacity expansion, tie-ups and innovation so as to take optimum advantage of the large opportunity.

  • Now that these investments have been completed/are nearing completion, the next few years could see significantly higher topline growth once the near term impact on demand caused by high inflation dissipates, thus continuing the period of clear outperformance versus FMCG peers.

  • With- 1. resumption of healthy topline and earnings growth beyond FY24E, 2. healthy free cash flow generation as capex intensity fades from extremely high levels up to FY24, 3. superior return ratios versus FMCG peers and 4. relatively inexpensive valuation after the recent correction, Britannia Industries appears to be an attractive investment candidate from a medium term perspective.

Click on the attachment to read the full report:

Nirmal Bang Britannia-Industries--FY23-Annual-Report-Analysis.pdf
ITC Q1 Results Review - Inline Sales; Margins Surprise Positively: Nirmal Bang


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