Britannia Industries' stock declined 7% over the past two days following disappointing Q4FY26 results. According to reports from Stock Market News, the biscuit maker's volume growth came in at a subdued 5.5% during the March quarter, significantly underperforming market expectations. The company's total consolidated operating revenue growth stood at 6.5% year-on-year to ₹4,719 crore for the quarter.
The growth moderation was primarily attributed to supply disruptions in international business following the West Asia war and competitive pricing challenges in the domestic market. As reported by Stock Market News, rivals operated at ₹4.5/9 price points versus Britannia's ₹5/10, creating dual pricing issues that particularly hurt growth in wholesale and business-to-business channels, which account for about 25% of sales. Channel checks by Nomura Research analysts suggest that Parle has moved to ₹5/10 price points from mid-March, though the positive impact on Britannia's numbers is expected to be visible from Q2.
Despite gross margin expansion for the third consecutive quarter, reaching 42.1% in Q4FY26, up 203 basis points, the figure fell short of expectations. According to Stock Market News, Ebitda margin dipped 9 basis points to 18.1% due to higher advertising and promotion expenses. The company faces significant cost pressures from the West Asia war, including significant rise in fuel costs and ocean freight rates. Britannia has initiated calibrated price hikes from Q1FY27 and is optimizing sourcing between India and international manufacturing facilities for key geographies.
Following the Q4FY26 results, multiple brokerages have reduced Britannia's earnings estimates for FY27 and FY28, with earnings per share estimates cuts ranging from 3-8%. As reported by Stock Market News, the stock currently trades at almost 47 times FY27 estimated earnings according to Bloomberg consensus data. Management believes growth will stabilize from Q1FY27, supported by easing of the dual pricing issue and the company's focus on creating new growth pillars including brand investment, premiumization, and new verticals.
