Leading Indian biscuit maker Britannia Industries Ltd is on an expansion spree. Along with launching new products and product variants, the company plans to strengthen its presence in markets outside India.
“Currently, more than 90% of our revenue come from our Indian operations. We are keenly looking at expanding our presence in international markets,” said Neeraj Chandra, vice-president, sales, marketing and innovation, Britannia Industries.
Britannia launched a new variant of Tiger biscuits, one of the power brands in its biscuit portfolio, on Monday, and the company says it is aiming at bolstering its biscuit portfolio that currently consists of popular brands such as Marie Gold and Good Day. “We are developing and testing various new products as of now. If our past record is anything to go by, we could soon be launching a new product a month,” said Chandra. Biscuits contributed more than 80% to the company’s total turnover of Rs2,200 crore in 2006-07.
The company also plans to enter new segments including ready-to-eat foods as well. “We are looking at opportunities in various other segments including ready-to-eat foods,” said Chandra.
The company is also looking at expanding its presence in the dairy sector. Britannia New Zealand Foods Pvt Ltd—a joint venture between Britannia and New Zealand-based Fonterra Co-operative Group—is already testing some products in the market. The company currently sells cheese and ghee through this venture. It has been testing packaged yogurt in Bangalore over the past few months and now, plans to roll it out across the top metros in the country. Turnover from the dairy business is estimated to be around Rs120 crore. “We are looking at providing more variants of our dahi (yogurt) including different flavours. We might also get into probitotic products,” said Chandra.
With the focus on dairy business, the company is joining rivals Nestle India Ltd, National Dairy Development Board (NDDB)’s subsidiary Mother Dairy, Gujarat Cooperative Milk Marketing Federation’s (GCMMF) Amul, and Yakult Danone India Pvt. Ltd, who are aggressively looking at getting a chunk of the world’s biggest, yet largely unorganised, dairy market. According to Dairy India Yearbook 2007, a trade journal, Indian dairy industry is likely to grow to Rs5 trillion by 2011 from about Rs3 trillion now.
“Dairy is a good space to be in as the market is largely unorganized,” said Anand Shah, an FMCG (fast moving consumer goods) research analyst with Mumbai-based brokerage firm Angel Broking Ltd. “This year, we will see more entries in this space, while existing players will add value-added products such as flavoured milk and low-fat yoghurts to their portfolios,” he added.
As for the international business, the company plans to enter new countries as well as build its presence in markets it is already present in. Last year, the company had acquired 70% stake in Dubai-based biscuit maker Strategic Food International Co (SFIC) and now it is looking at expanding its exposure in West Asia. “SFIC makes biscuits and other products for third parties as well. We hope to benefit from its associations,” said Chandra. SFIC markets its range of products that include wafers, biscuits and cookies, in around 70 countries across the world.
He said the company is looking at entering new global markets as well but he declined to share much details.