Cracking the biscuit business: A holistic analysis of Britannia Industries

Britannia Industries Ltd, commonly known as Britannia, is an iconic Indian company that has carved a niche for itself in the food industry. With a rich history spanning over a century, Britannia has established itself as a household name, synonymous with quality, trust, and delectable treats. From biscuits to bread, cakes to dairy products, Britannia has consistently delighted consumers with its diverse range of offerings.

It is involved in the manufacturing and sale of various food products. Its portfolio includes biscuits, bread, cakes, rusk, and dairy products including cheese, beverages, milk, and yoghurt. 

Its geographical segments include both India and overseas. The company’s products are exported to over 79 countries across the world. Its subsidiaries include Britchip Foods Limited, Manna Foods Private Limited, and Snacko Bisc Private Limited. 

In this article, we have analysed the historical stock performance of Britannia Industries Ltd, specifically focusing on instances when the stock price doubled, with a base price of Rs 100. We have also examined the duration it took for consecutive doublings to occur.

Analysing the provided data table, we can draw several conclusions about the stock performance of Britannia Industries Ltd. Firstly, the stock took approximately 4221 days, or around eleven and half years to double and reach Rs 200 from its base price of Rs 100. Subsequently, it took around three years of 1155 days to achieve the milestone of Rs 400. Remarkably, within just one more year, the stock surpassed Rs 800. Continuing its upward trajectory, the stock doubled again from Rs 800 to Rs 1600 within just one year or in only 261 days in 2015. 

On average, Britannia’s share has doubled every three years over the past decade. Whereas the best performance it has taken in the year 2015 reached Rs 1600 from Rs 800 and has taken only 261 days to become double. Currently, the stock is trading around Rs 5000 and has already completed almost 5 years since its last doubling, but still, the stock has not reached double the level which is Rs 6400.

The stock has generated a return of 35.39% in the last year, whereas it has given a return of around 41.57% in the last three years. Its 52-week highs and lows are Rs 5084.95 and Rs 3555, respectively. Currently, the stock is trading at a PE of 59.5 times. The total market capitalisation of the company is Rs 120715.96 Crore. 

The promoter holding in the company is 50.55%, while FIIs and DIIs hold 19.44% and 14.22%, respectively. The remaining portion of 15.79% is held by public investors.

Peer Comparison: 

Financial Overview 

Britannia Industries Ltd witnessed a significant YoY increase in annual revenue during FY23, with a surge of 15.31% from Rs 14,136 Crore to Rs 16,301 Crore. Over the past three years, the company’s sales have shown a CAGR growth of 12% in three years. The operating profit stands at Rs 2,831 Crore, resulting in an operating profit margin of 17%. Furthermore, the net profit for the company amounts to Rs 2,316 Crore, with a net profit margin of 14.12%. Moreover, the net profit has experienced a CAGR of 13% over the past three years.

The company’s ROCE and ROE are at 48.8% and 66.6%, respectively. As per the recent financial updates, the total debt stands at approximately Rs 2,997 Crore, resulting in a debt-to-equity ratio of 0.85 times.

Conclusion

In conclusion, Britannia Industries Ltd stands out as a prominent player in the fast-moving consumer goods sector, showcasing consistent stock performance over time. While the company’s stocks recently reached an impressive milestone of Rs 5000 and also demonstrated positive financials, it is noteworthy that the stock is nearing the completion of a five-year period since its last doubling, surpassing the ten-year average duration still not reached Rs 6400. Nevertheless, it possesses significant potential for further growth in the near future.

Disclaimer: This article has been written for educational purposes only. The securities quoted are only examples and not recommendations.