Financial Performance Overview

  • Revenue growth: 12.5% Year-on-Year
  • Volume growth: 7.7%
  • EBITDA margin: 13.5% (improved from 12.2% in previous quarter)
  • EBITDA growth: 13% quarter-on-quarter

Segment Performance

  • Ethnic Snacks: 11.4% growth
  • Western Snacks: 21.3% growth
  • Sweets: 4.4% growth
  • Papad: Declined due to early monsoon impact on handmade production
  • Retail business: 71.8% YoY growth with stores increased from 15 to 28

Geographic Performance

  • Core states: 11% growth
  • Focus states: 19% growth (UP grew 37%)
  • Other states: 5.6% growth
  • Export: -2.2% decline due to US tariff disturbances and 2-3x freight cost increases

Operational Highlights

  • Direct coverage: 370,000 outlets (added 17,000 outlets in Q1)
  • Family pack growth: 11%
  • Impulse pack growth: 10.5%
  • Marketing investment: Heavy investment in Q1 including Pankaj Tripathi campaign for UP

Supply Chain Disruptions

First 45 days of quarter impacted by:

  • Chairman's demise resulting in 3-4 days plant shutdown across India
  • Bengal elections causing movement of Bengali labor affecting Bikaner production

Last 45 days showed strong recovery with approximately 20% growth

Margin Pressures and Pricing

  • Input cost pressures from edible oil (geo-political issues, less rainfall) and pulses (moth dal, chana dal)
  • Two price increases taken in last 4 months
  • No further price increases planned until after Diwali festive season
  • Gross margins improved despite cost pressures

Capacity Expansion

  • New ASRS investment in Bikaner: 1 lakh square feet construction
  • Additional 1.2-1.3 lakh carton capacity to ease supply chain
  • Targeting bhujia production outside Bikaner to mitigate labor dependency

Retail Expansion Plans

  • THF format: Targeting 10 new stores this year (22 to 35 stores)
  • 50 stores target in next 2.5-3 years
  • Bikaji stores: 2 new stores planned this year
  • THF targeting ₹700 crores business with 25%+ store-level EBITDA
  • Retail business expected to grow 50-60% YoY for next 3-4 years

International Operations

  • Nepal JV: ₹15 crores investment each partner, plant construction underway
  • Production expected to start in 8-9 months (around April-May 2027)
  • US business: Targeting 3x growth in next 2 years
  • Export contribution target: 5.5-6% of overall business in 3-4 years

Bakery Segment Update

  • Bikaji Bakes in trial/R&D phase
  • Three target channels: export, e-com/q-com, HoReCa
  • No significant contribution expected this fiscal year

PLI Scheme Impact

  • Q1 PLI contribution: ₹12.5 crores (₹50 crores annualized equally across quarters)
  • PLI contributes 150 basis points to EBITDA margin
  • Expected 50-75 basis point margin impact after PLI ends
  • Targeting 1.5-2 years to recover margin post-PLI

Festive Season Outlook

  • Q2-Q3 sweets growth target: 12-13%
  • Gifting growth target: 17-18%
  • Overall festive growth target: 16%+
  • Marketing spend to remain heavy during festive quarters

Margin Guidance

  • FY27 EBITDA margin target: 13-13.5% (including PLI)
  • Long-term margin target: 15% in next 3 years
  • Q2 margin expected to benefit from sweets mix and operating leverage

Category Growth Context

  • Snacking category growth slowed to single digits in last 2 years from previous double digits
  • GST reduction from 12% to 5% helped category momentum
  • Quick commerce channel growing >100% for Bikaji

Raw Material Outlook

  • Edible oil and pulse prices increasing
  • Coal prices increased contributing 0.3-0.4% to manufacturing costs
  • No immediate price increases planned despite cost pressures