Analysts at Antique assigned a ‘Buy’ rating and a target price of ₹7,000, a potential upside of 18 per cent.
The brokerage said its positive view is driven by premiumisation within the company’s core biscuit segment, scaling up of higher-margin adjacent categories, and distribution expansion in underpenetrated markets such as rural areas and the Hindi-speaking belt.
Antique said Britannia is executing a balanced growth strategy aimed at positioning itself as a ‘total food company’ while maintaining leadership in the biscuit category. The company has also been allocating capital in a disciplined manner toward improving manufacturing efficiency and expanding distribution, it added.
The brokerage expects Britannia’s Ebitda margin to remain healthy at around 18-19 per cent between the Financial Year 2026 (FY26) and FY28, supported by stable raw material prices and continued efficiency initiatives.
Antique also noted that Britannia has significantly increased its in-house manufacturing capabilities over the years. The share of in-house manufacturing has risen from about 25 per cent in FY11 to 65 per cent in FY25, with plans to increase it further to around 70 per cent. This shift is expected to reduce reliance on contract manufacturing and improve supply chain efficiency, it said.
The company’s product portfolio has also steadily shifted toward premium offerings, which now account for roughly 65-70 per cent of sales, significantly higher than industry peers. This shift has been driven by low unit packs, which now contribute about 60 per cent of sales compared with around 40 per cent in 2019, as well as new product launches such as Nutri Choice and Pure Magic.
At the same time, Britannia has been expanding into higher-margin and relatively underpenetrated adjacent categories including dairy, cakes, croissants, wafers and rusk. These segments currently contribute about 25 per cent of the company’s revenue, and the brokerage expects their share to increase to around 50 per cent over the medium term.
Antique added that the adjacency portfolio remains largely unorganised and underpenetrated, offering significant long-term growth opportunities. Britannia has recently entered categories such as wafers and croissants, which are growing at more than 20 per cent compound annual growth rate, and the company is gradually building scale and strengthening its position in these segments, Antique said.
===========
(Disclaimer: The views and investment tips expressed by the analysts in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.)