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India's Britannia more than doubles Q3 profit on price hikes, sustained demand

FILE PHOTO A worker stands next to a production line at the Britannia biscuit factory in New Delhi

BENGALURU (Reuters) - India's Britannia Industries on Wednesday said its third-quarter profit more than doubled, benefitting from higher prices and resilient demand for its products as well as a one-time gain.

The company, which makes biscuits such as Good Day and Little Hearts, reported a profit of 9.32 billion rupees ($113.86 million), up from 3.71 billion rupees a year earlier. This also includes a one-time gain of 3.76 billion rupees from a stake sale.

"On the cost and profitability front, our pricing actions and intensified cost efficiency program helped mitigate inflation," Managing Director and Vice Chairman Varun Berry said, adding that the Bengaluru-based company's operating margin improved by 330 basis points.

"We are being vigilant of the competitive actions in the marketplace and shall deploy appropriate pricing actions to drive market share."

India's retail inflation, after hovering around 6% for about a year now, has eased in the last two months of 2022, allowing companies to be more optimistic about consumer spending in the upcoming quarters.

The country's fast-moving consumer goods (FMCG) sector has grown consistently over the years and the improved connectivity in smaller towns is helping fuel this rising demand for FMCG products via online stores.

Consolidated total revenue from operations grew 17.4% to 41.97 billion rupees for the reported quarter.

In November, Britannia entered into a three-way joint venture with its subsidiary Britannia Dairy and French dairy products maker Bel SA to develop and sell cheese products in India and a few other markets.

As part of the deal, Britannia sold an equity stake of 49% it held in Britannia Dairy to Bel SA.

Britannia's shares climbed 19.5% last year, outperforming a 4.3% increase in India's bluechip Nifty 50 index.

($1 = 81.8560 Indian rupees)

(Reporting by Yagnoseni Das in Bengaluru; Editing by Janane Venkatraman)