Britannia to set up Rs1,000 crore plant in Maharashtra’s Ranjangaon food park
Britannia MD Varun Berry says the new plant, which will be the biscuit maker’s biggest will be ready in two years and will be fully functional in 4-5 years
Bengaluru: Biscuit-maker Britannia Industries Ltd will set up its biggest manufacturing facility at Ranjangaon in Maharashtra at an investment of Rs1,000 crore, managing director Varun Berry said on Monday.
The facility, for which the company has already secured 96 acres and has applied to the administration for an additional 48 acres, will be ready in two years, but it will be fully functional only in 4-5 years, he added.
The facility will have six lines for production of biscuits, and one each for filled croissants, cakes, rusks, flour and dairy. It will employ 3,000 people, and will be the first to have an integrated dairy and flour mill.
Britannia has not yet decided whether to run the flour mill on its own. “We have to take a call whether we do it ourselves or get a reputed miller to do it for us,” Berry said.
The plant is located in the Pune-Ahmednagar region, which is one of the biggest producers of milk in the country, Berry said.
Britannia is transforming itself from a biscuit-maker to a foods firm. It has signed a pact with Chipita SA, a Greek firm, to make croissants with fillings, rolls and other snacks.
For the current fiscal, Britannia has budgeted a capital expenditure of Rs450 crore. Over the next two years, it will be spending Rs300 crore to expand its dairy production, Berry said.
Meanwhile, the company continues to consolidate its brands in different categories. The cream biscuit category is yet to be consolidated, where it still has three different categories.
The premium cream biscuit market in India is estimated at Rs1,800 crore and Berry claimed Britannia controls 35% of it. The company is planning further consolidation of its offerings in this category, said Ali Harris Shere, vice president (marketing).
The company is also setting up a plant in Nepal to serve the local market. Biscuits made at the company’s Uttar Pradesh and Bihar facilities are currently exported to Nepal.
With the goods and services tax (GST) having been implemented, Britannia is looking to raise prices by 2-3% which was put on hold until the new tax regime came into being.
Speaking about the June quarter results, Berry said the company was able to mitigate the impact of GST by tweaking its distribution plan well in advance and by offering credit to wholesalers.