In a conversation with Mahesh Kulkarni and Sheetal Agarwal, Varun Berry, MD, Britannia, talks about the quarter gone by and the road ahead. Edited excerpts:
What has driven the performance in the December quarter?
The third quarter was a fairly good quarter for us with good growth in volumes and revenue. Two years back, we had embarked on a journey of strengthening the building blocks. We wanted to grow faster than the market and strengthen our go-to-market strategy much deeper and wider. We wanted to strengthen pillar brands and at the same time keep our costs under tight control. This back-to-the-basics approach has worked for us and we have delivered consistent results for the past eight quarters. In the third quarter, for the first time, we have crossed the Rs 2,000 crore mark in revenues. During the quarter, all our businesses have performed well. The domestic bakery business standalone is good, subsidiaries like dairy and international business are accretive to our business.
What is your reading of the demand trends in the industry?
In the last quarter, the overall industry did not fare well and grew only 5 per cent in revenue terms and 1.5 per cent in volume terms. The overall environment is not looking positive. That will hopefully change going forward with the new government moving in the right direction which, we hope, will help the industry. We have our fingers crossed. We are clear on our agenda which is making sure that our foundation is rock solid and we continue to build on innovation.
Have you passed on the gains from lower input costs or added them to the margins?
Last quarter, raw material inflation was about 5 per cent, down from 7 per cent at the beginning of the year. We have ploughed back some of the gains on all our pillar brands and gave more value to our consumers in three brands -- Good Day, Marie and Milk Bikkies -- in terms of more biscuits in each pack.
How have new launches in the quarter namely Good Day Chunkies and Nutrichoice Heavens fared so far?
It is too early to declare victory. But, certainly, we are pleased with their performance and we hope they will be an essential part of our portfolio and give us returns both in volumes and profits going forward.
