Analysts at ICICI Securities note that volume growth of 3 per cent in the quarter under review continued the subdued performance from the first quarter. They believe that apart from "rural slowdown" narrative, Britannia’s performance has also been impacted by the improvement in growth by regional players, pointing towards an end of easy market share gains (in North and East India) and therefore a muted medium-term.
However, recent launches in premium biscuits and geographical expansion of adjacent products can somewhat mitigate this challenge, they wrote. The brokerage has maintained 'REDUCE' rating on the stock with DCF-based target price unchanged at Rs 2,700. At their target price, the stock will trade at 34x Sep’21E.
At 10:10 am, the stock was trading over 5.50 per cent higher at Rs 3,288.60 apiece on the BSE against a 0.03 per cent rise in the S&P BSE Sensex. Shares of Britannia had hit a 52-week high of Rs 3,443.90 on September 23.