Beverages to cheese, companies ramp up capacity
2 min read . Updated: 03 Feb 2023, 11:36 PM IST
Premium- Britannia—among the top biscuit makers in the country—has been diversifying its portfolio entering adjacent categories
NEW DELHI : Fast-moving consumer goods makers Britannia Industries Ltd and Dabur India Ltd, are adding more food and beverage brands to their portfolio and ramping up capacity.
During an earnings call on Thursday, Britannia executives outlined plans for a larger play in the dairy market, following its recent joint venture with French cheese maker Bel. At its recently opened Ranjangaon factory, production of dairy products such as curd and dairy whiteners has commenced. The company has rolled out fresh paneer in parts of West India. At the Ranjangaon factory, a line for cheddar cheese will be commercialized in Q1 FY24; the processed cheese line will be ready in the second half of FY24, the company said.
Commenting on the Bel joint venture, Varun Berry, executive vice-chairman and managing director, Britannia said, “We are working on the joint branding how the products and the packaging designs are going to look. We are working on the organization structure, training the personnel. We are finalizing our portfolio not just for the immediate launch but how the portfolio will look in the next two to five years."
Britannia—among the top biscuit makers in the country—has been diversifying its portfolio entering adjacent categories such as snacks (wafers and croissants) and dairy.
The company’s current biscuit to non-biscuit salience to top line stands at 77% and 23%, respectively; the company plans to change that to 75% and 25% in a few years.
The push by companies to step up their play in the branded foods and beverages market comes as demand for packaged foods led growth of FMCG market in the December quarter, reporting a positive volume growth.
Mint had earlier reported that packaged food launches are picking up as large consumer goods companies try to capitalize on the rising demand for ready-to-cook meals, snacks, edible oils, pulses and juices, amid a shift in consumer preference from unbranded to branded products.
Recently, Reliance entered the packaged foods market as well.
On Thursday, Dabur India too outlined plans to scale its beverages business in the run-up to the summer season. The company expects its foods business to reach ₹500 crore in next three-to-four years, analysts at Nuvama Institutional Equities said in a 2 February report. Meanwhile, its beverages business (excluding juices and nectars) is expected to touch ₹200 crore this year.
“Coming season, we are augmenting our capacity—at our plant in Pantnagar. We are setting up a new plant in Indore and also in Jammu for aerated beverages—for our ₹10 and ₹20 price point drink packs. So, I think we are pretty much geared up. Surplus capacity is available outside; also, in case we’re not able to ramp up, we can always outsource. I don’t think we should face any capacity constraints in summer," Mohit Malhotra, CEO, Dabur said.
To be sure, Dabur has a large portfolio of foods and beverages including Réal and Activ range of juices and fruit-based beverages, and Réal Fizz in aerated fruit drinks. Under foods, it has the Hommade range of culinary pastes, Dabur ghee, cooking oils, chutneys, pickles, and spices. The company’s foods and beverages portfolio reported net sales of Rs1,312 crore in FY22.
