Sharekhan has given Buy recommendation for Britannia Industries with a target price of Rs. 4375 in its research report issued on Jan 31, 2022

Sharekhan’s research report on Britannia Industries

Britannia posted good numbers amid a slowing demand environment with revenues growing by 13% y-o-y led by high single-digit volume growth, which is better than ours as well as the street’s expectation of 2-3%. The company continued to gain market share in Q3 and gap vis-a-vis the second-largest player has widened. Market share gains in rural areas are 2x ahead of urban areas. Raw material inflation dragged down OPM by 420 bps y-o-y to 15.1%. Raw material inflation stood at 20% in Q3. The company has undertaken 8% price increase and will undertake another 2-4% price hike in Q4. The stock has underperformed broader indices and is trading at 41.3x/35.0x its FY2023/24E earnings.

Outlook

We maintain a Buy rating on the stock with an unchanged PT of Rs. 4,375.

More Info on Trent

At 16:00 hrs Britannia Industries was quoting at Rs 3,656.45, up Rs 121.55, or 3.44 percent.

It has touched an intraday high of Rs 3,708.90 and an intraday low of Rs 3,549.70.

It was trading with volumes of 16,531 shares, compared to its thirty day average of 8,013 shares, an increase of 106.29 percent.

In the previous trading session, the share closed up 0.79 percent or Rs 27.55 at Rs 3,534.90.

The share touched its 52-week high Rs 4,152.05 and 52-week low Rs 3,317.90 on 14 September, 2021 and 22 February, 2021, respectively.

Currently, it is trading 11.94 percent below its 52-week high and 10.2 percent above its 52-week low.

Market capitalisation stands at Rs 88,072.29 crore.

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