Britannia Industries
Cleanest GST beneficiary
- Last close
- ₹4,835.00
- 29 Sept 2026 · reference
- 1D · 1M
- −1.6% · −8.9%
- price-only
- Weight
- 2.0%
- 31 Jul 2026 · Aug rank 21
- Thesis review
- 8 Sep 2026
- Why We Own, p34
Approved description
India's largest biscuit maker (Good Day, Marie Gold, Tiger, NutriChoice, Milk Bikis, Bourbon) with adjacencies in cake, rusk, wafers, croissants (~Rs 200 cr ARR, >30% CAGR), dairy (cheese, drinks) and bread; ~80% of the portfolio moved to the 5% GST slab in Sep-2025. Wadia Group promoted (50.6%). FY26 consolidated revenue Rs 19,152 cr, EBITDA margin ~18%, ROE 53-56%. International business (Middle East, Africa, North America) is small and was disrupted in FY26 by a Middle East-to-Mundra SEZ production shift. Biscuit market share is not quantified in the sources used (company typically cites leadership with share gains vs Parle/ITC).
- 01Volume recovery is real: ~9% volume growth in Q1FY27 (vs low-single digits in FY25) as biscuits moved from 18% to 5% GST on 22-Sep-2025 - Nomura estimated 80% of Britannia's Indian portfolio benefits, making it the biggest listed beneficiary of GST 2.0.
- 02Best-in-class returns in Indian FMCG: ROE 53-56% for three years, ROCE 56%, dividend payout 84%; FY26 PAT +16% to Rs 2,537 cr on 6.7% revenue growth.
- 03Premiumisation/adjacencies scaling: croissants at ~Rs 200 cr ARR growing 30%+, cakes/rusk/wafers in strong double digits, e-commerce in strong double-digit growth; new CEO Rakshit Hargave (ex-Birla Opus) executing general-trade expansion at 1.5x last year's pace.
- 04Rural/mass tailwind: ~Rs 1.7 lakh cr of state cash transfers to ~120 mn women (marginal propensity to consume ~0.9 in Maharashtra study) flows disproportionately to Rs 5-10 biscuit packs.
- 05Valuation below history: 46.6x trailing vs Nestle India 72.7x and Marico 56x; consensus TP (PL Rs 6,441) implies ~28% upside from Rs 5,042.
Reference close, with results-period markers
- 1Q Sep-25 end · 30 Sept 2025
- 2Q Dec-25 end · 31 Dec 2025
- 3Q Mar-26 end · 31 Mar 2026
- 4Q Jun-26 end · 30 Jun 2026
Quality score, technicals and Buoyant Score
Computing the scorecard…
Latest quarter · Q Jun-26
| Line (₹ cr) | Q Jun-26 | YoY | QoQ |
|---|---|---|---|
| Net Sales | 5,000 | +8.2% | +6.0% |
| Operating Profit | 840 | +11.0% | −1.5% |
| Net Profit | 591 | +13.4% | −12.8% |
Reported vs internal estimate: internal quarterly estimates are not in the supplied package; consensus feed not licensed. YoY/QoQ per PRD §12.5 (transitions, not %, on non-positive bases).
Position and valuation context
General industrial/consumer/IT preset: growth, margins, ROCE/ROIC, working capital, FCF, net debt; P/E, EV/EBITDA.
Sell-side targets are third-party views, not Buoyant's; the upside is recomputed on our reference close, so it differs from the figure printed at the broker's price date.
Valuation range
No headline target on this page; the book quotes the thesis and the risk rather than a target.
What we watch
- Q2FY27 results (early Nov-2026): management guided a return to double-digit topline growth 'by the fag end of Q2FY27'; 1.5-2% price hikes flowing through should lift margin.
- Festive quarter (Oct-Dec 2026) with full GST 2.0 base effect and state cash-transfer disbursements; NIQ data for Jul-Sep 2026 (due Nov-2026) will show whether food volume growth re-accelerates.
- Board decisions on capital allocation (dairy/adjacency capex, possible special dividend given 84% payout and Rs 5,100 cr net worth) and PLI incentive recognition (none booked in FY26/Q1FY27).
- Input-cost inflation (LPG/CNG, palm oil, sugar, packaging from crude spikes and West Asia conflict) with only ~50% mitigated by pricing in Q1FY27 - EBITDA margin (16.8%) is below the 18-19% of FY24-FY26 and PL cut FY27/28 EPS 4-5%.
- Competitive dual-pricing disruption in the 60-65% mass segment (competitors kept old MRPs post-GST) and Oman/UAE production shift cost ~1-1.5% of sales; double-digit topline not expected until end-Q2FY27.
- Slow structural growth: 5-yr sales CAGR 7.8% and profit CAGR 6% (screener); at 47x trailing and 23.8x book any volume relapse compresses the multiple further (stock -17% YoY).