Motilal Oswal has issued a buy rating on Bikaji Foods International with a target price of ₹770 in its research report dated August 06, 2026. According to the brokerage's analysis, the recommendation is based on a DCF-based target price using an implied P/E of 55x on FY28E. The investment thesis is supported by the company's strong quarterly performance and growth prospects across its product categories.
Bikaji Foods delivered robust first-quarter results with revenue growing 12.5% year-on-year to ₹7.3 billion. As reported by Motilal Oswal, the growth was primarily driven by volume growth of 7.7% YoY. The company's EBITDA and adjusted profit after tax (APAT) grew 2.8% and 1.6% YoY respectively. The Western Snacks segment emerged as the fastest-growing category with 21.3% YoY growth, followed by Ethnic Snacks at 11.4% YoY and Packaged Sweets at 4.4% YoY, while Papad declined 6.5% YoY.
The company demonstrated strong distribution expansion during the quarter, adding approximately 17,000 outlets to reach a total coverage of 371,000 outlets. According to Motilal Oswal's report, this expansion increased the company's reach to 1.5 million outlets and aims to reach 500,000 outlets over the next three years. The retail business showed exceptional growth with revenue increasing by around 72% YoY, while the store network expanded from 15 to 28 stores during the quarter.
Management highlighted that June and July witnessed strong demand across product categories and channels, with the last 45 days of the quarter delivering approximately 20% growth. As reported by Motilal Oswal, the company expects mid-teen growth to resume from Q2 onwards, supported by healthy demand across core and focus markets. The margin is expected to be 13.0-13.5% for FY27 (including PLI). However, the brokerage has trimmed earnings by 9% for FY27/FY28 due to lower margin guidance.
According to Motilal Oswal's analysis, key risks to the investment thesis include geographical concentration in core markets and the potential entry of new competitors in Rajasthan. The brokerage has reiterated its buy rating despite these concerns, citing the company's strong fundamentals and growth prospects across its product portfolio.
