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Britannia plunges 5% despite double-digit growth recorded in revenue, PAT during Sept 2020 quarter – Indiainfoline

Wadia Group-backed Britannia Industries registered a consolidated net profit of Rs495.20cr for the quarter ending September 2020 (Q2FY21), compared to a profit of Rs405.37cr recorded in the corresponding period of the previous year, registering a growth of 23%.

The top-line front also witnessed double-digit growth. Consolidated revenue from operations increased by 12.1% to Rs3,419.11cr in the quarter under review, as against Rs3,048.84cr a year ago same period.

Britannia posted a net profit of Rs 542.68cr and revenue of Rs3,420.67cr in the June 2020 quarter.

Consolidated sales of goods stood at Rs3,354.35cr in the latest quarter, higher from Rs3,022.91cr as of September 2019, but sequentially lower compared to Rs3,384.4cr of the preceding quarter.

On quarter-on-quarter (QoQ) basis, Britannia witnessed downside on both bottom-line and top-line front.

Varun Berry, Managing Director of Britannia Industries, said, “In this quarter, we got our full range of products to the market, focussed on efficiency in distribution, followed continuous replenishment system of distribution, improved the health of our distributors and inched closer to normalcy in advertisement & promotions. The nimble culture & the hard work put in by the team helped deliver a resilient performance in these challenging times. All the adjacent businesses too delivered a healthy profitable growth.”

On the cost front, Berry added, “we witnessed moderate inflation in the prices of key raw materials and expect the prices to be stable going forward given the positive outlook on monsoon & harvest. We sustained a large part of the efficiency gains that we witnessed in the previous quarter viz., supply chain efficiencies, reduction in wastages and fixed costs leverage. These measures helped us sequentially sustain the shape of our business and record a massive 390 bps increase in operating profit during the quarter vs. last year.”

Going forward, Berry said, “We are keeping a close watch on macro-economic factors, changes in laws, evolving consumer behaviour and are framing our medium-term strategy laying out scenarios to deal with this dynamic environment. We are confident of performing well in these tough times with the agility in our action and passion of the team.”

On Tuesday, Britannia stock witnessed huge sell-offs. The stock has plunged by over 5% so far on Sensex, with an intraday low of Rs3575.00 per piece.

At around 10.05 AM, Britannia stock was trading at Rs3583.40 per piece down Rs190.40 or 5.05%.