Taking the changing matrix of Indian consumer tastes head on, Britannia Industries Managing Director and Chief Executive Officer Vinita Bali is furrowing out a different path in its non-biscuits categories comprising dairy, cereals and health and wellness brands. In conversation with N V Vijayakumar of Deccan Herald, Bali explains her endeavours to fortify biscuits with iron, vitamins and minerals by removing trans fats, which has brought dividends to the company with its market cap catapulting more than double to $1.1 billion.
Growing changes in consumer tastes in the country will have its impact on company strategy. How is Britannia tackling these challenges?
More than challenges we are looking at it as an opportunity in India. Our (India) food industry has grown into a $220-billion entity. Within this, only 9-10 per cent are sold as branded and packaged products. With the growing aspiration levels among people and more purchasing power, there is a large opportunity for companies like Britannia. Here, we are also witnessing the arrival of more MNCs to tap this growing opportunity.
We have a diversified portfolio which includes bakery items like biscuits, cakes, rusks, bread, milk products and cereals as breakfast. Our biscuits whose prices start at Rs 2, going up to Rs 50, cater to the entire demography of consumers like old people (NutriChoice), adults (Thin Arrowroot, oats and ragi), children (Tiger, MilkBikis), family (Marie), among others. We have dairy items which include milk and paste products (single shot milk products), chaas (butter milk), plain dahi and cheese. Our large footprint in the market positions us uniquely to take on the aspirationally growing Indian market in the realm of bakery and milk products.
You are expanding your health product portfolio of late. Could you elaborate?
We are not into the health food business but are looking at ways of making baked snacks more healthy. Our health portfolio is a tad less than 40 per cent or 50 per cent of our overall revenues. Within biscuits, we are carving out a ‘healthy’ portfolio. Here, we have removed transfats and fortified it with micronutrients; it comprises 50 per cent of our portfolio. We have biscuits with functional benefits and less glycaemic index. It serves as a hunger buster. This includes brands like Marie, Tiger and NutriChoice. We started fortifying our products since 2008. Today, NutriChoice is our seventh power brand.
Our zero fat and zero cholesterol dairy products include ‘Slims’ in milk, in cheese and dahi. We also launched chaas which is 98 per cent fat-free. For children, we have created nutritious beverages like Tiger Badaam Doodh, a chocolate milk fortified with iodine, zinc, etc. Even our bread is fortified with micronutrients. Our 100 per cent wheat bread, multi-grain bread, bread with oats and honey are all doing well.
With Britannia Healthy Start, we are bringing out a delicious range of ready-to-cook breakfast mixes including pohas, upmas, oats and porridges — healthy, delicious and ready-to-eat in just 5 minutes. It combines the natural nutrition of multigrains, 100 per cent real vegetables, pulses, nuts and mouthwatering spices, giving your family the healthy start they need everyday. Here we have Classic Oats, Savoury Oats, Strawberry Oats and Multigrain Porridge.
How do you view the place of premium products in the food segment?
Premium is the overall experience we pack with our products. Here digestive oats, ragi, and flavoured yoghurt, in that sense, give value for money.
Your consolidated revenues in December 2012 registered 13 per cent growth at Rs 4,498 crore. What has been your marketing strategy?
How many consumers try and how many of them buy our products are important aspects of our market research. We also keep improving and renovating our existing products. We recently renovated and repackaged Timepass biscuit. We have five or six iconic brands and continue to improve them to make them more contemporary. Good Day’s 25th anniversary was celebrated with much fanfare.
Can you explain a little about Britannia’s product mix?
We have launched six products in the last financial year and are planning more products in the current fiscal. We are planning some 'human interest products' from Britannia this financial year too. We brought out rusks last year and it boosted our revenues. Now, close to 20 per cent of overall revenues comes from dairy, cereals and other stuff in the non-biscuit categories. We look at mixing demand from local tastes with universal aspirations in our products.
What is the impact of the current economic slowdown on the industry as a whole?
India is not really going through any recessionary pressure. But there obviously is a sluggishness in the market which has had its impact on input costs. However, we have withstood these impacts through cost and innovation management and sharing the benefits with our consumers. We registered a better-than-expected 11 per cent rise in net profit to Rs 62.1 crore in the third quarter of the last financial year. Ware expecting the same in the fourth quarter as well, with at least 13-15 per cent growth in certain categories.
Besides being the CEO of Britannia, you are known for your corporate social responsibility activities. Can you throw some light on that?
We have formed Britannia Nutrition Foundation (BNF) as part of our corporate social responsibility programme. BNF supplies fortified biscuits to 800 public schools in southern India. I have become the only Indian member of a 27-member influential United Nations panel tasked with leading the scaling up nutrition movement globally. Britannia's supply of iron-fortified biscuits via NGO Naandi’s midday meal scheme to schools has been listed by Bill Gates as one of the eight examples of creative capitalism.
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