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Biscuit major Britannia Industries Ltd, led by Nusli Wadia, wants to beat Parle to attain the numero uno spot in the next three years. The company has lined up new launches in the coming quarters and a capex budget of Rs 150-200 crore for the next two years.
During the annual general meeting (AGM) here on Tuesday, Wadia said the company had gained 1.2 per cent of market share and the gap with Parle was three per cent. “We want to bridge it in the next three years. Our capex would focus mainly on innovation and capacity addition,” he said in response to a query by a shareholder during the AGM.
At present, Britannia’s biscuit manufacturing capacity is 74,000 tonnes a month. Later during the day, managing director Varun Berry said the company had lined up new launches in the next three to six months. “A major part, about 90 per cent, of the new launches would be in the premium segment,” added Berry.
According to Wadia, Britannia has recorded better growth than that of the market, something which was not possible in the past couple of years. During the first quarter of the current financial year, the company recorded a double-digit volume growth in the biscuit business, Berry noted. The company has also taken a decision to make an exit from the daily bread business which had 29 outlets. “We are primarily an FMCG (fast-moving consumer goods) company and we want to keep that intact. Daily bread business has caused a loss of about Rs 2 crore and we are looking to exit the business,” said Vinod Menon, vice-president and chief financial officer. The biscuit major would focus more on SAARC (South Asian Association for Regional Cooperation) countries, said Wadia. “We should have a greater presence in that region. Apart from Bangladesh, Sri Lanka would be key focus,” he added.
The margins have been under pressure owing to a price rise of about 30 per cent in milk prices, but on an overall basis, raw material prices are appearing to be stable, according to the management. The company aims to have a larger pie of own manufacturing against its earlier policy of a larger pie of contract manufacturing. “We are also working on adding depth in our distribution in the cities and town, while efforts are on to increase our width in rural distribution,” Berry added.
