Impact of price hike will be seen next quarter, Varun Berry says after Britannia net first quarter fell 11%

• The cookie maker Britannia reported an 11% drop in net profit to 335 crore compared to the same quarter last year.
• The company’s president, Varun Berry, attributed this decline in profits to global factors that ultimately impacted commodity prices in the country.
• The company’s fate in the next quarter will depend on the monsoon and Kharif season, which will determine the extent of recovery in the countryside.

Commodity price inflation hurt cookie maker Britannia as it reported an 11% drop in net profit to ₹335 crore compared to the same quarter last year. Revenues increased marginally by 4% to ₹3,700 crore in the same period.

The company’s president, Varun Berry, attributed this decline in profits to global factors that ultimately impacted commodity prices in the country.

“In terms of costs and profitability, global factors continued to influence the economy, leading to a further rise in inflation during the quarter. Certain commodities relevant to the bakery sector, such as wheat and industrial fuel, showed steep sequential inflation during the quarter, ranging between 15 and 20%,” Berry said during an analyst call.

The company had passed some of this initial push to consumers as price increases. “While we have made the necessary price increases to cover this, the full impact of price correction should be reflected in the next quarter,” he said.

The company’s fate in the next quarter will depend on the monsoon and Kharif season, which will determine the extent of recovery in the countryside.

Meanwhile, the FMCG player has expanded its nationwide footprint by adding approximately 27,000 nationwide preferred dealers. During the quarter, it launched new products — Biscafe, Bourbon Vanilla Cheesecake, Nutrichoice Seeds & Herbs.

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