Britannia's Q1 margin slips as costs outpace sales sequentially
Year-on-year profit rose +14.08%, but a higher tax rate drove a -12.70% sequential decline.
Filed 06 Aug 2026, 18:52 IST · after market close · Britannia Industries Ltd (BRITANNIA)
Key takeaways
- Consolidated net profit rose +14.08% year on year to Rs 593.38 cr as revenue grew faster than expenses.
- Sequentially, expenses grew +7.60% against revenue growth of +5.96%, narrowing operating margin by 1.27 percentage points to 16.80%.
- The tax rate rose 12.15 percentage points sequentially to 25.58%, contributing to a -12.70% fall in net profit.
Price around the results
Year-on-year growth came with better operating leverage
Britannia's consolidated revenue grew +8.17% year on year to Rs 4,999.97 cr, while expenses rose +7.62%. That gap lifted operating profit by +10.97% to Rs 840.11 cr and widened operating margin by 0.42 percentage points. Net profit increased +14.08% to Rs 593.38 cr, helped by lower interest costs, which fell -12.54%.
Sequential margin pressure and tax distortion stand out
Quarter on quarter, expenses grew +7.60% while revenue rose +5.96%, reducing operating margin by 1.27 percentage points. Interest costs also increased +22.43%, while the tax rate rose 12.15 percentage points to 25.58%, pushing net profit down -12.70% despite a +1.56% rise in profit before tax. Other income contributed 7.48% of pre-tax profit, so reported earnings also included a meaningful non-operating component.
Margin is now down for a second straight quarter
Operating margin has declined from 19.72% in Q3FY26 to 18.07% in Q4FY26 and 16.80% in Q1FY27. Despite that sequential deterioration, Britannia remained 0.68 percentage points above the 16.12% median margin of 29 Fast Moving Consumer Goods peers that have reported the quarter.
No immediate market reaction after the filing
The consolidated results were filed after market close, so the stock has not yet recorded a reaction to this quarter's numbers. Across the last eight result reactions, the stock rose three times and fell five times, with a median absolute move of 2.48%, giving a mostly negative historical pattern with moderate typical volatility.
Q1FY27 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹5,000 cr | ₹4,719 cr | +5.96% | +8.17% |
| Other income | ₹60 cr | ₹36 cr | +64.92% | +14.30% |
| Expenses | ₹4,160 cr | ₹3,866 cr | +7.60% | +7.62% |
| Operating profit | ₹840 cr | ₹853 cr | -1.50% | +10.97% |
| Operating margin (%) | 16.80% | 18.07% | — | — |
| Interest | ₹23 cr | ₹19 cr | +22.43% | -12.54% |
| Depreciation | ₹80 cr | ₹85 cr | -6.71% | -3.08% |
| Profit before tax | ₹797 cr | ₹785 cr | +1.56% | +13.74% |
| Tax | ₹204 cr | ₹105 cr | +93.46% | +12.76% |
| Net profit | ₹593 cr | ₹680 cr | -12.70% | +14.08% |
| EPS (₹) | ₹24.55 | ₹28.16 | -12.82% | +13.55% |
Operating margin of 16.80% compares with a Fast Moving Consumer Goods sector median of 16.12% across 29 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +1.96% | +2.23% |
Volume on the results session was 10.35× its 20-day average.
What to watch
- Whether operating margin holds above 16.80% after its second straight quarterly decline.
- Whether expense growth remains below the +8.17% year-on-year revenue growth rate.
- Whether the tax rate moves back from 25.58% after the sequential increase of 12.15 percentage points.