Financial Performance Overview

  • Consolidated Revenue Growth: 15% YoY in Q1 FY27
  • Sequential Growth: 11% over Q4 FY26
  • EBITDA Margin: Sustained at 7% (normalized net of ESOP costs)
  • Gross Margin Improvement: 110 basis points YoY despite inflationary environment

Segment Performance

Sundrop Business (56% of total revenue)

  • Growth: 16% YoY in Q1 FY27 (accelerated from 14% in Q4 FY26 and 12% FY26 full year)

Del Monte Business (44-45% of total revenue)

  • Growth: 14% YoY in Q1 FY27 (accelerated from 9% in Q4 FY26 and 9% FY26 full year)

Channel Performance

  • B2B Business: Grew 18% YoY
  • E-commerce: Grew 32% YoY (ahead of industry growth rates)
  • Modern Trade: Showing increased salience but specific growth rate not quantified

Category-wise Performance

Core Portfolio (60% of business, growing at 14-15% value, 9-10% volume)

  • Popcorn Business: 18% value growth with 12% volume growth
  • Ready-to-Cook: 9% growth
  • Ready-to-Eat: 39% growth (accelerated from 33% last year)
  • Expanding distribution in West and South; focusing on Sweet Popcorn and Cheese variants
  • Culinary Business (Ketchup, Mayo, dressings): 15% value growth with 8% volume growth
  • Strong growth in B2B and exports to Southeast Asia
  • Italian Business (Olive Oil, Pasta, Ready-to-Eat olives): 8% value growth with 15% volume growth
  • Olive Oil: ~20% volume growth, strong e-commerce performance
  • Pasta: 10% growth in e-commerce and food service channels

Premium Staples Business

  • Edible Oils: 16% value growth with 7% volume growth
  • 9% price increase passed through while maintaining volume growth
  • Focus on selective geographies and channels of strength
  • Peanut Spreads: 3% decline (improved from 8-10% decline last year)
  • Faced headwinds in modern trade and e-commerce due to market shift to value-added formats
  • E-commerce returned to 16% growth with new innovations
  • Current market share: 33% in standard peanut butter, 3% in value-added segment

Investment and Margin Strategy

  • A&P Spends: Like-to-like comparison shows 5% lower vs Q1 FY26 due to optimization
  • Core portfolio receives ~8% of sales invested in advertising and promotion
  • Moving to ROI-centric marketing investment approach
  • Margin Improvement Drivers:
  • 40 bps improvement in material costs despite inflation
  • 70 bps reduction in other expenses
  • Automation of salesforce: 80% outlets now billed through platform (up from 75% last quarter)
  • Innovation: Launched ~100 products in last 24 months contributing 4% of sales
  • Q1 innovation contribution at 6% of sales
  • Targeting 6-8% of growth from innovation (40% of growth ambition)

Integration and Synergy Benefits

  • Del Monte Integration Status:
  • E-commerce already consolidated under single operation team
  • CFA consolidation: Del Monte had 10 unique CFAs, 2 consolidated, third underway
  • Target: Only 2 unique CFAs remaining by end of CY2026
  • Sales team integration in East region completed
  • Expected Synergy Benefits: 200 bps margin improvement over next 18 months
  • ERP Evaluation: Underway for single ERP system migration within 12 months

Growth Strategy and Outlook

  • Volume-Value Mix Target: 50% volume, 25% price, 25% innovation for high-teens growth
  • Margin Expansion Roadmap: Target of 12% EBITDA margins within 3 years
  • 100 bps from ESOP cost normalization (front-loaded for next 18-21 months)
  • 200 bps from operational synergies
  • 100 bps annually from scale benefits
  • 80-100 bps annually from premiumization
  • Capital Efficiency: Shift from CapEx-driven to capital-efficient approach using third-party manufacturing
  • Inorganic Growth: Actively looking at acquisition opportunities to accelerate growth momentum

Management Participants

  • Mr. Nitish Bajaj – Group Managing Director
  • Mr. Asheesh Kumar Sharma – CEO and Executive Director
  • Mr. KPN Srinivas – CFO
  • Mr. Abhinav Kapoor – CEO, Del Monte Business
  • Mr. Amitosh Kumar Banka – CFO, Del Monte Business

Additional Information