The return of the adult lunchbox and escalating raw material costs could hit high street bakers like Greggs for as long as the consumer downturn continues, analysts at Oriel Securities have warned.

Analysts Jonathan Pritchard, Eithne O’Leary and Ben Hunt said that Greggs’ interim results on 9 August would show a fall in earnings and they feared the underlying picture was getting worse.

They cited research published in British Baker sister publication The Grocer that showed adult lunchbox consumption was up 3% year-on-year overall and up 5.6% among 17- to 34-year-olds.

“The average constituents of a lunchbox cost £1.40. In our view, while the £1.99 meal deal at Greggs is attractive, it not only must be squeezing internal gross margins, it is at risk of being undercut by those choosing to make their own lunches,” the analysts said in a note on the company, entitled Can they stand the heat?

The analysts acknowledged there would be those who “trade down” to Greggs, but their view was that if people were willing to trade down from Asda to deep-discounters Lidl or Aldi, then many would surely also be willing to cut their own sandwiches to save 50p a day.

They cited recent warnings from Cranswick and CSM about higher raw material costs. CSM, the world’s largest supplier of bakery products, reported “some loss of volume as the market adjusted to higher prices”. Cranswick suggested raw material costs increased during the second quarter – an important statement bearing in mind about a third of Greggs’ sales are in the savoury market, according to Oriel.

However, Pritchard told British Baker Greggs had done well by moving into the breakfast and coffee markets. He said the market was cyclical and, if there was a consumer upturn, the lunchbox trend would be reversed.

A spokeswoman for Greggs said the company did not comment on anything analysts wrote.