Britannia expects double-digit volume growth after election: MD Varun Berry

Leading food products company Britannia Industries expects a "double-digit growth" in volumes post general elections and the monsoon season with a "manageable inflation", its Vice Chairman and Managing Director Varun Berry said on Monday.

The company is "hopeful of recovery in consumption" this fiscal year with an expectation of stable inflation and a good monsoon.

It anticipates a "healthy inflation" of around 3 per cent in FY25, which will also help achieve faster growth of its topline as it moves forward, Berry said in a post-earnings conference call.

"Last quarter volume growth was two times the revenue growth. So I think volume growth this year, we expect them to be quite solid," he said.

Barring a few months in FY25, which would be pretty similar to the last fiscal, Berry expects a double-digit volume growth for Britannia, maker of Good Day, Marie Gold, Tiger, Bourbon, and Milk Bikis biscuits.

"The volume growth this year, we expect them to be quite solid. And I would think that post-election, post-monsoon, we would be aiming towards a double-digit volume growth for sure," he said.

Besides, Britannia will try to hold its high margins, despite spending a "right amount" on innovations, brand building and other market-related projects, Berry said in reply to a query.

"So I would say, there would not be a major change from what we have seen upside... . I would not expect upsides on this, but not a major change from where we are today," he said.
 

On inflation, Berry said the first quarter will be flattish.

"As we go forward post-elections, you will start to see inflation. This is my forecast and I will be very happy if it is proven wrong but it seems that post-election, we will start to see a 4 per cent kind of inflation," he said.

According to Berry, prices of commodities such as sugar and wheat are a concern.

However, it has "been balanced by palm, laminates and corrugated boxes. So the commodity situation has been soft this quarter".

Berry also added there is a likelihood that sugar prices will go up, while the wheat crop is in good condition.

"We are closely monitoring the commodity situation and assessing what are the actions that we need to take as we go forward. We remain vigilant on the pricing front and our strategy will be to remain focused on driving market share while sustaining profits," he said.

The leading biscuit maker also expects revenue from its adjacent categories to expand further. Currently, it is getting around 25 per cent from this segment.

Britannia has also commercialised its cheese factory at Ranjangaon (near Pune) and has started to make supplies.

"So we are hoping that this year we will see dramatic results," Berry said.

The company is expanding its market reach and under its route to market 2.0 strategy, leveraging Data Analytics and Artificial Intelligence.

Under this, it is trying to multiply adjacent business revenues while continuing to build core. It is also focusing on high-potential outlets, increasing "Feet on Street" with split portfolios and upscaling salesmen capability.