Sundrop Brands reports a 15% year-on-year revenue increase in Q1 FY27, driven by strong growth across core and e-commerce segments, as the company aims to double EBITDA margins within three years through operational synergies and strategic integration.
Sundrop Brands said its revenue rose 15% year on year in the first quarter of FY27, extending the momentum from the prior quarter and lifting sales across both of its main businesses. The company said Sundrop grew 16% and Del Monte 14%, while e-commerce advanced 32%, helped by quick commerce and hybrid platforms. Despite inflation in commodities and packaging, gross margin improved by 110 basis points and EBITDA margin held at 7%, suggesting the group has so far managed to offset cost pressure through pricing and tighter control of spending.
The strongest gains continued to come from the core portfolio, which management said makes up about 60% of the business and is growing at 14% to 15% in value and 9% to 10% in volume. The popcorn business maintained 18% growth, while culinary products accelerated to 15%. Ready-to-eat popcorn was a standout, with growth of 39% and a move into margin-positive territory. The Italian range also recovered, returning to 8% value growth alongside 15% volume growth as pricing conditions began to stabilise.
Management laid out an ambitious earnings plan, saying it sees EBITDA margin rising from 7% to 12% over three years. Nitish Bajaj, the group managing director, said the improvement should come from operational synergies, the fading of employee stock option costs and scale benefits, with the company targeting annual margin gains of roughly 300 basis points. He said integration of the Sundrop and Del Monte businesses is being done carefully, starting with shared e-commerce operations and a combined carrying and forwarding network before a single ERP system is introduced over the next 12 months.
Not all parts of the portfolio are moving at the same pace. Peanut butter remained a weak spot, although the decline improved from last year as the company added value-added variants such as chocolate and high-protein products. Edible oils grew 16% in value, but much of that came from price increases, with management saying the aim in that category is mainly to protect volume. Moneycontrol’s financial data show the group had already posted strong full-year revenue growth in FY26, although profitability remained thin, underscoring why the current push for scale, innovation and margin expansion matters.
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