Sundrop Brands Limited Q3 FY26 Earnings Call Transcript Released
Sundrop Brands Limited released its Q3 FY26 earnings call transcript. The company reported 10% consolidated revenue growth and 80% EBITDA growth for Q3 FY26. Key drivers include strong performance in popcorn, culinary, and Italian businesses. Marketing investments increased by 22% in Q3, and gross margins improved by 330 basis points.
The announcement is the release of a transcript of an investor call, which provides detailed financial and strategic information. While positive, it doesn't introduce new material events but rather elaborates on previously announced results and ongoing strategies.
The company reported strong financial performance with significant revenue and EBITDA growth, improved margins, and positive commentary on future prospects and strategic initiatives. The management also addressed competitive concerns proactively.
Sundrop Brands Limited (formerly Agro Tech Foods Limited) has released the transcript of its Investors/Analysts Conference Call held on February 13, 2026. The call was conducted to discuss the Unaudited Financial Results for the quarter and nine months ended December 31, 2025.
The management team present included Mr. Nitish Bajaj (Group Managing Director), Mr. Asheesh Kumar Sharma (CEO and Executive Director), and Mr. K.P.N. Srinivas (Chief Financial Officer). The call was moderated by Mr. Ajay Thakur from Anand Rathi Share & Stock Brokers Limited.
Key highlights from the discussion included strong growth momentum in Q3 FY26, with consolidated revenue growing at 10%. B2B growth was reported at 9%, and e-commerce growth remained robust at 31%. Advertising investments increased by 22%. The company reported an 80% growth in consolidated EBITDA for Q3, driven by a 330 basis points improvement in gross margins, primarily from the foods business. Year-to-date (YTD) figures also showed strong performance with similar revenue growth and a 40% EBITDA growth.
The company detailed its brand portfolio, comprising ACT II (popcorn, snacks), Sundrop (edible oils, expanding into cereal snacks and oats), and Del Monte (culinary, Italian, packaged foods). Strategic investments are focused on the popcorn business (ACT II), peanut butter (Sundrop), and culinary business (Del Monte).
Volume growth was observed across most categories, including Sundrop oil (5% in Q3), popcorn (12%), culinary (10%), and Italian business (16%, with olive oil volumes up 34%). The spreads business remains a focus area for improvement. The company is also expanding its oats business, showing over 200% growth in e-commerce and modern trade channels.
Marketing investments have increased, with YTD growth at 37% and Q3 growth at 22%. The sales force automation project is progressing well, with 58% of the network covered on a mobile interface, aiming for full coverage of 375,000 outlets by the end of the financial year.
Margin improvement was a key theme, with a 330 basis points improvement in Q3 gross margins (230 basis points YTD). Employee expenses grew by 12% (excluding ESOP charges), while other expenses (manufacturing, logistics, SG&A) were controlled at a 2% increase. Consolidated EBITDA saw an 80% growth in Q3 and 40% YTD (excluding one-off project costs). Profit before tax (PBT) showed strong growth of 190% in Q3 and 239% YTD.
Discussions also addressed competitive intensity, particularly in the popcorn segment with the entry of Marico. Sundrop Brands highlighted its strong distribution, efficient backend, and planned investments to maintain market share and accelerate growth. The company is also exploring institutional opportunities through its Del Monte network.
Regarding the ready-to-eat (RTE) portfolio, the split between small packs (INR 10) and large packs is approximately 70%-30%. The company anticipates a gradual shift towards larger packs due to e-commerce growth, while continuing to focus on penetration for smaller packs. Distribution expansion efforts are underway, including productivity enhancements and leveraging wholesaler networks.
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