Britannia shares surge 5% after strong operating beat in Q2 results, brokerages upbeat

Shares of Britannia Industries Ltd

. are likely to react on Thursday, November 6, in response to its quarterly results, which were reported during the mid-week holiday on Wednesday.

The company's revenue of ₹4,841 crore was largely in-line with the CNBC-TV18 poll of ₹4,878 crore, while its net profit of ₹655 crore was higher than then estimate of ₹585 crore.

However, the operating performance of the company was a convincing beat in comparison to expectations. Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of ₹955 crore was over ₹100 crore higher than the CNBC-TV18 poll estimate of ₹846 crore, while margins of 19.7% were also well above the poll estimate of 17.3%.

On a year-on-year basis, the company's EBITDA grew by 21.8%, while margins expanded nearly 300 basis points.

Gross margins for the quarter also saw a 20 basis points expansion to 41.7% from 41.5% last year.

The management attributed the growth to Rusk, Wafers and Croissants, which continued to delivery double-digit growth and that the aim is to drive the business through healthy volume-led growth.

In another announcement, Britannia announced the appointment of Rakshit Hargave as its CEO, after Birla Opus announced the resignation of Hargave during the mid-week holiday on Wednesday.

40 analysts have coverage on Britannia, out of which 25 have a "buy" rating, 12 say "hold", while three have a "sell" recommendation.

Shares of Britannia Industries have opened with gains of 5% on Thursday at ₹6,186, closing in on its 52-week high of ₹6,336.