Mrs Bector Foods Reports Record Q2FY27 Revenue Driven by Bakery Growth

Mrs Bector Foods posted record revenue for the second quarter of fiscal year 2027, growing 14 percent year on year. The company's EBITDA margin stood at 13.1 percent, aligning closely with street estimates of 13 percent, even as it navigated a steep rise in input costs.

The company's performance was largely supported by its bakery business, which maintained strong momentum during the quarter. The English Oven brand recorded mid-teens growth in volume and high-teens growth in value terms. Meanwhile, the institutional bakery segment witnessed a recovery driven by quick service restaurant (QSR) demand.

However, the biscuits business faced pressure due to weak rural demand stemming from a below-normal monsoon, alongside West Asia-led shipping disruptions. Despite these challenges, quick commerce (Q-Com) has emerged as a significant channel, currently contributing approximately 22 percent to the company's B2C revenue.

Looking ahead to the remainder of the fiscal year, management expects FY27 revenue growth to land in the mid-teens, with second-half growth anticipated at mid-to-high teens. This outlook is supported by price hikes implemented in October and November, ongoing distribution expansion, product premiumisation, and the recovery of deferred export orders.

On the margin front, management anticipates that current gross margins will sustain as price hikes annualise and project impact savings take effect. With inflation expected to peak in Q3FY27, the company aims to maintain its EBITDA margin at around 13.1 percent before improving it to 13.5-14 percent in Q4FY27. Management has also reiterated its medium-term EBITDA margin target of 14-15 percent.

Reflecting on the strong second-quarter performance and the revised growth outlook, financial analysts have introduced earnings estimates for FY29e while tweaking estimates for FY27 and FY28e. Citing healthy earnings visibility and reasonable valuation, analysts have retained a 'Buy' rating on the stock, raising the target price to ₹275 from ₹250 earlier, valued at 35 times September 2028 earnings per share.

"Mrs Bector Foods has demonstrated resilience by delivering record revenue during a quarter impacted by input cost pressures and rural demand headwinds. The strong performance of its English Oven brand and the rapid scaling of quick commerce, which now contributes over a fifth of B2C revenue, highlight the importance of adapting distribution channels. Sustaining margins amidst inflation will rely heavily on pricing power and operational efficiencies as management executes its growth strategy for the second half of the fiscal year." — Dr. Shishir Gupta, Founder & CEO, StartupLanes