Britannia Industries Ltd — Q4 FY24
Britannia reported Q4 FY24 revenue of INR 4,014 crore, up 3% YoY, with EBITDA margin at 17.6%, down 4% YoY due to pricing actions and higher A&P spend.
neutral
medium
✓ Verified against BSE filing
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
79%Questions answered2Evaded / deflected12Questions auditedConsistentNumbers vs filing
Answered
High priority
Outlook on wheat pricing and top-line growth given soft commodities.
Asked by Abneesh Roy, Nuvama Institutional Equities
Management gave a specific inflation forecast and commodity outlook.
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Question
My first question is on your key raw material, wheat, and how you see pricing this year at the customer level? ... If your commodity remains soft, how do you see overall pricing for the full year?
Varun Berry, Vice Chairman and Managing Director
Our outlook on this year is slightly inflationary, which is a healthy inflation of 3%-3% or thereabouts. ... I would think that the wheat outlook is slightly inflationary during the year.
Evasive
Medium priority
Timeline and benefits of RTM 2.0 project.
Asked by Abneesh Roy, Nuvama Institutional Equities
Management declined to provide specific KRAs, offering to discuss separately.
deferred to separate chatno specific KRAs given
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Question
you have mentioned that this will be pilot project in H2 of FY 2025, which means FY 2026 will be the real year ... in terms of KRAs for this project for FY 2026, what could it be?
Varun Berry, Vice Chairman and Managing Director
I put everything on that slide. If there's more detail required, we can chat about that separately, Abneesh. ... the full impact will be towards the end of this year.
Answered
High priority
Revenue share and margins of non-biscuits portfolio.
Asked by Avi Mehta, Macquarie Group
Management provided a specific share and qualitative margin comparison.
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Question
the non-biscuits portfolio, what is the current share of sales? And, more importantly, how do the margins contrast in this portfolio versus the biscuits business?
Varun Berry, Vice Chairman and Managing Director
It's about, it's about, 25%. ... Average would be maybe slightly better. The gross margins. The net margins will not be, but the gross margins will be slightly better.
Partial answer
Medium priority
One-off costs in other expenses and volume growth for the quarter.
Asked by Avi Mehta, Macquarie Group
Management addressed one-off costs but did not provide the volume growth figure.
no volume growth number given
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Question
are there any one-off costs in the other expenses incurred in this quarter? And then what were the volume growth was for the quarter?
Varun Berry, Vice Chairman and Managing Director
There are no very small. There's nothing worth mentioning as far as this quarter is concerned. ... advertising and sales expenses have been higher this month.
Answered
High priority
Volume vs price growth split for FY24 and normalized volume growth expectations.
Asked by Latika Chopra, JPMorgan India
Management gave a clear split and a specific volume growth target.
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Question
For FY 2024, you had revenue growth of 4%. Could you split, what was the volume growth and the price growth or deflation during FY 2024? ... what is the normalized volume growth expectations?
Varun Berry, Vice Chairman and Managing Director
for the last year has been they are almost at par, right? So volume and revenue are the same. ... post-election, post-monsoon, we would be aiming towards a double-digit volume growth for sure.
Answered
High priority
Optimal margin expectations given gross margin improvements and investments.
Asked by Latika Chopra, JPMorgan India
Management gave a clear margin outlook without specific numbers but directional.
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Question
what is the optimal margin expectations that we should build into next year? ... would you give away some margins, or you think these are sustainable margins?
Varun Berry, Vice Chairman and Managing Director
not a major change from what we've seen. Upsides, I would not expect upsides on this, but not a major change from where we are today.
Answered
High priority
Impact of RTM 2.0 on margins, NPD sales target, and adjacent portfolio margins.
Asked by Sheela Rathi, Morgan Stanley
Management confirmed NPD target and margin flexibility with specifics.
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Question
would it be fair to say that near term there could be some negative impact coming on margins, given the RTM 2.0 ... the NPD to sales number, is that correct, that INR 275 crore is the NPD number? ... how should we think of margins on that aspect?
Varun Berry, Vice Chairman and Managing Director
our target for the entire set of NPDs is north of 3.5%. ... If it means taking a short-term hit on margins because of all the projects ... we will be willing to do that. But it's not gonna be dramatically different.
Evasive
Medium priority
Dairy business size and expected growth in 2-3 years.
Asked by Sheela Rathi, Morgan Stanley
Management did not provide current dairy share or future target.
no specific size or target given
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Question
when you talked about the adjacent portfolio at 25%, where would dairy be, right now, and where do you expect that to be, say, in the next 2-3 years?
Varun Berry, Vice Chairman and Managing Director
So dairy is, we have. As you know, we've taken a big punt on dairy. ... I wouldn't say that we've achieved what we had planned for ourselves. We are short of that.
Answered
High priority
Growth drivers: biscuits vs adjacencies, and plans for new categories.
Asked by Arnab Mitra, Goldman Sachs
Management gave a clear growth ratio and stated no new categories this year.
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Question
Do you think it will be driven more by the biscuits portfolio or a big scale-up in the adjacent fields? ... do you have plans to add more segments to some of these adjacent fields?
Varun Berry, Vice Chairman and Managing Director
our focus from biscuits can never go away ... the adjacency business grows at one and a half times what our biscuit portfolio grows at. ... we will desist from doing that to make sure that we get a very strong sense of growth.
Answered
High priority
Pricing trajectory: deflation in H1 and inflation in H2?
Asked by Arnab Mitra, Goldman Sachs
Management provided a clear quarterly inflation outlook.
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Question
Your comment on a 3% inflation next year, would it be fair to assume it's more back-ended, you would expect first half to still be a deflation and significant pricing in the second half?
Varun Berry, Vice Chairman and Managing Director
I think the first quarter is flattish, but as we go forward, post-election, we will start to see inflation is my forecast. ... post-election, we will start to see, you know, 4, 4% kind of inflation.
Answered
Medium priority
Market share trends: small players doing well vs company gaining share.
Asked by Mihir Shah, Nomura
Management explained the dynamics and their strategy to address competition.
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Question
Anecdotally, the small and regional players seems to be doing well. However, we see that you are also gaining share. Are you also seeing any trend about small and regional players doing better?
Varun Berry, Vice Chairman and Managing Director
Post the inflationary environment when we took a lot of pricing, everyone saw our profits ... a lot more competition started to come in ... However, on delving more into it, we figured out that their share situation was because of their spreading their wings from their core market.
Answered
Medium priority
RTM 2.0 vs rural distribution expansion priority.
Asked by Harit Kapoor, Investec India
Management clearly stated both initiatives will proceed simultaneously.
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Question
Would that project take precedence over expanding direct reach and strengthening rural distribution? Or do you believe that both will go hand in hand?
Varun Berry, Vice Chairman and Managing Director
these will both go hand in hand. ... the distribution expansion project is more about the bottom end of the pyramid, which is about rural distribution. ... we cannot take our eye off our rural agenda.
Quantitative claims vs filed numbers
| Claim | Management said | Filing | Verdict |
|---|---|---|---|
| Volume and revenue growth were almost at par for FY24. | 4% | 3% | Matches filing |
Filed figures sourced from Screener.in. Claims within a small tolerance of the filing are marked “matches filing”.