Britannia sees demand rise, but sugar and palm oil costs bite

Mumbai: Britannia Industries said consumer demand has strengthened in recent months, with sales accelerating towards the end of the June quarter, even as a surge in sugar, palm oil, and industrial fuel costs threatens to squeeze margins.

"The demand environment continues to be strong," chief executive Rakshit Hargave said on a quarterly earnings call Friday. "Whether this holds good for the rest of the year, we will have to see."

Sales growth last quarter was fuelled by higher underlying demand and retailers returning to Britannia as dual-priced packaging following cuts in goods and services tax (GST) with effect from September 22, 2025, cleared out, according to the company. "We don't see any of this as a result of any inventory buildup," said Hargave. "It is a result of demand buildup and the fact that the retailers who had kind of shied away a bit have come back to us in strong numbers.


For the first quarter of FY27, the maker of Good Day biscuits reported a 9.5% year-on-year growth in revenue from operations at '4,964 crore. Profit after tax grew nearly 14% to '591 crore. Volumes increased 9% in terms of total tonnage, translating to sequential share gains across biscuit categories, according to Hargave.

The recovery comes as Britannia grapples with a surge in input costs.

The company said it had so far been able to offset only about half of the inflation through pricing actions, with further pricing measures expected through changes in pack sizes and packaging.

"If the overall impact was 1%, you will probably see another 1.5% to 2% coming in," he said.