Britannia Industries Ltd. has recorded net sales of Rs 2.9 bn (up 22% YoY) and a net profit of Rs 106 mn (up 22% YoY) for the quarter ending 30th June 1999. ]]
Britannia, the market leader in the bakery business commands a 38% market share in biscuits and 40% in breads. Group Danone of France owns a 22% stake in the company.
Britannia has been facing increased competition in all the segments it operates in. The company has responded well by diversifying into the dairy business despite the presence of Amul in this sector. The consolidation of its dairy activities, which grew by 45%, has enabled the company to boost sales.
The bakery business grew at 20% during the quarter. This was due to buoyant biscuit and cake operations. The company's aggressive attitude in launching new products has pushed sales to its current levels.
With the dairy diversification and new product launches Britannia has ensured that it stays on the high growth path. However, with more competition, profit margins could take a hit.
The stock has been rated as a 'BUY' by analysts because of the company's successful efforts in increasing market share in various segments of operations. Also, the reputation of the management and the aggressive launching of new products have led to this rating.
LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India. Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: firstname.lastname@example.org. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407