Revenue on track, profitability stalled by inflation & ad spend

Revenue ₹734.3 Cr, YoY growth 12.5% delivered exactly

OPM 13.5% matches, but QoQ growth only 2% vs Q1 disruption narrative

PAT grew only 1.6% YoY despite 12.5% revenue growth, no pricing pass-through visible

Volume growth 7.7%, well below prior double-digit trends; ethnic snacks 11.4%, sweets 4.4%, papad -6.5%

Claimed but not verified against total revenue, low single-digit contribution to business

Q1 showed 13.5% OPM; FY27 target 13%-13.5% (flat). Prior FY26 momentum narrative lost to inflation, ad spend. 50 bps improvement QoQ only if Q2–Q3 leverage kicks in.

Volume +7.7% Q1, ethnic +11.4%, sweets +4.4%, papad -6.5%. Prior FY26 narrative was 16% volume; demand slowdown real despite secondary channel strength.

Prior call expected 'continued momentum'; Q1 export -2.2%. Freight crisis (3x costlier) and US tariffs deferring shipments, not a one-quarter blip.

28 stores now (vs 15 one year ago), targeting 35 by end-FY27, 50 in 2.5–3 years. 50-60% YoY growth, 25% EBITDA per store achieved; still ahead of guidance.

THF (premium sweets/gifting) will open ~10 stores/year, 22→35 stores FY27, 50 in 2.5–3 years. Targeting ₹6–8 Cr per store sales, 65–70% from gifting, 25%+ EBITDA. Bikaji stores: 2 new this year, evaluate post. THF targeting ₹700 Cr total business.

Bhujia manufacture concentrated in Bikaner (Bengali labor heavy); snacks plants across India grew +20%. Mitigation: will manufacture bhujia in 2 plants this year to diversify. Learning: decentralize production to avoid Bikaner isolation.

Q-com growing exponentially; Bikaji 100%+ growth Q1. Category growth outpacing, brands sustain better than private labels. Too early to claim share gains; growing 'faster or in line' with channel growth.

Coal prices +0.3-0.4%, manufacturing cost +40 bps. Ad/promotional +40-50 bps. YTD ad target ~2%. Year-ahead spending level: 'target close to 2%, maintain this year'.

Sweets 12-13% growth Q2-Q3 expected; gift packs higher; total festive (sweets+gifting) 17-18% growth. Full-year aspiration mid-teens to high-teens, 16%+ clarity.

Story of two halves: first 45 days disrupted (shutdown + labor), second 45 days recovery (June highest-ever delivery, July strong). Q1 report is 30-day consol; yes, disruption cost volume, but made up post-May 18.

Category slowed to single-digit growth last 2Y (vs prior double-digit). Q1-Q2 FY26 were weak (heavy rains). GST relief (12→5%) released inflation, momentum picked up post-Q2. Bikaji disruption from 45-day shutdown also factor. June/July recovery gives confidence mid-teens recovery.

PLI currently 150 bps EBITDA contribution. Targeting 50-75 bps mitigation via pricing + gross margin improvement. 1.5-2Y to reach original margin post-PLI cliff.

Q-com is only play in packaged snacks. Low single-digit contribution to category overall. Top brands ~50% of category, D2C/small brands ~50%. Brand sustainability questionable; handful truly sustain.

JV done, all paperwork ready. Plant construction underway. Both parties ₹15 Cr invest each. Production in 8-9 months (Dec 2026–Jan 2027). Near Birgunj-Kathmandu.

Q2 heavy on sweets (high margin), volume heavy → fixed cost leverage → EBITDA improves. FY27: targeting 13%-13.5% margin. Q1 was 13.5%; expect moderation due to heavy Q2-Q3 ad spend.

US tariff uncertainty ongoing, but biggest hit: crude oil prices 3x higher, containers scarce. Freight cost 2-3x from booking → dispatch deferrals. Demand strong; just dispatch delays.

Nepal: invest to grow, save import duties, boost competitiveness. US: should 3x in 2Y. Currently 3-4% of business; target 5.56% in 3-4Y. Exports 'huge growth opportunity'.

Mid-teens from 'this quarter onwards'. Core markets 13-15% (already high share, growth = category growth). Focus markets disproportionately high; UP 37% this quarter, target 30%+ full year.

Handmade, weather-dependent. Early monsoon, disrupted drying/production. Also lost Chairman first 45 days. 6% of business, won't impact overall; will make up later.

15% margin is 3Y target, not this year. FY27: 13.5%, then 50 bps YoY improvement minimum. Next 2Q heavy on ads for festive, will ease; helps margin normalization.

Core markets 13-15%, focus states 30%+ (UP 37% this Q budgeted). Underlying demand strong post-disruption recovery (last 45 days +20%). Export headwinds (dispatch deferrals) temporary.

Organized retailers (modern trade, q-com) committed Diwali plans; orders locked in. No price hikes till post-Diwali, demand cushioned.

Q1 benefited from high fixed-cost leverage. Q2-Q3 heavy ad spend for festive (offsetting gross margin gains), 50 bps improvement minimum YoY targeted. Coal/edible-oil inflation headwind ongoing.

Vague mechanism. Depends on PLI offset (50-75 bps via pricing + gross margin), leverage from retail at scale (THF 40-50% growth), and category recovery acceleration. PLI cliff (150→50-75 bps) 1.5–2Y recovery.

Bhujia production diversification (2 plants) underway. Nepal JV plant ₹15 Cr investment, Dec 2026–Jan 2027 production. Retail expansion (THF stores) CapEx in pipeline.

Edible oil, coal, pulses prices up. Heavy marketing spend (+40-50 bps) in Q1, planned to continue Q2–Q3. PLI cliff (₹50 Cr drop) = 150 bps headwind next year. Pricing power limited (only 2 hikes in 4 months achieved 12.5% revenue growth, not enough to expand profit).

Export declined -2.2% Q1, blamed on 3x freight cost (crude oil impact) and US tariff uncertainty. US is 'very big share' of export business. Management acknowledges 'quarter or couple of quarters' uncertainty on resolution. Underlying demand strong, but dispatch deferrals deferring revenue.

Volume growth 7.7% Q1 (ethnic snacks 11.4%, sweets 4.4%, papad -6.5%), well below prior 15-17% aspiration. Industry-wide slowdown: 'till 2Y back, category growing double-digit; last 2Y single-digit growth'. Bikaji organic growth limited by category headwinds.

Core Bikaneri bhujia manufactured only in Bikaner historically. Q1 Bengali labor migration due to Bengal elections, plus Chairman's death, caused 3-4 day shutdown + 45-day production constraints. Isolated Bikaner facility creates tail-risk vulnerability.

28 THF stores now (vs 15 one year ago); targeting 35 by end-FY27, 50 in 2.5-3 years. Per-store EBITDA claimed 25%+ at current scale (8-9 Cr annual run rate), but full-year expansion to 50 stores may dilute economics or face execution delays. Tier 2 city focus limits market size.