Commodity prices key for future of Britannia, margin expansion focus, says Kaustubh Pawaskar, Sharekhan
«Also in terms of the commodity price momentum, because this quarter, there is almost 200 bps expansion in the gross margin, so how the commodity price momentum is and whether we should expect such kind of gross margin expansion in the quarters ahead or not, these are something which will be very important from the commentary perspective from the management,» says Kaustubh Pawaskar, Sharekhan, on Britannia’s Q1 Results.
ET Now: Let us take your first take on the numbers that have come out of Britannia, from our overall estimates it is revenue that is in line, PAT is in line and margins are also in line. What is your overall assessment?
Kaustubh Pawaskar: So, revenues came slightly better than what we were anticipating for the quarter. High single digit volume growth. We were expecting volume growth to be in the mid-single digit. Margins came broadly in line with what we were anticipating at around 18%. PAT of around 505 crores is also in line with expectations. So, results are broadly in line with expectations. The key watch out going ahead would be how the Hindi-speaking belt is doing for the company, because that was a lag for the company for a while. And once there is a recovery in the rural market, we should also expect the Hindi-speaking belt to be gradually doing well. And also in terms of the commodity price momentum, because this quarter there is almost 200 bps expansion in the gross margin, so how the commodity price momentum is and whether we should expect such kind of gross margin expansion in the
