Pandemic brought significant shifts in consumer preferences, says Britannia Industries
The pandemic has brought significant shifts in consumer preferences and behaviors, including the growth of online business channels, which are likely to strengthen and present new opportunities for the food business in the future, according to Britannia Industries.
The company is well placed to sustain growth and is confident of addressing the evolving situation with its wide distribution network, intrinsic brand strengths, innovation, and technology capabilities, and cost-efficiency programs, it said in its latest annual report.
"Significant shifts in consumer preferences and behaviors, growth of online business channels, and higher demand for staples and value products are some of the changes brought about by the pandemic. These trends are likely to strengthen and present new opportunities for the food business in the future," the company said.
According to Britannia, it foresees opportunities to scale up its dairy business by leveraging product innovation and accelerating the growth of value-added products into the segment.
The company is going for expansion of distribution for the dairy portfolio, growth of e-commerce & digital subscription platforms, and culinary experimentation at home with categories like cheese due to the lockdown.
In the segment, Britannia sees quality milk procurement and infrastructure improvement, including cold chain, as the primary growth challenges.
"To address these challenges, your company has been continuously investing in farmer connect programs, scaling up milk procurement capabilities, ensuring consistency in quality of raw material, and strengthening cold chain distribution," it said.
"High levels of household penetration (above 90 percent) augurs well for an increase in consumption. There is potential to spur consumption growth through innovative, healthy, and premium products," the annual report said.
In the cake segment, Britannia said its immediate strategic priorities are to strengthen and scale up innovation, renovate and make the base cake segment more premium and in new-to-market formats with affordable prices.
"There are opportunities for growth through the launch of innovative products at different price points and expansion in rural markets," said Britannia Industries.
In rusk, Britannia's strategy is to grow by investing in technology, renovate the existing portfolio and expand the category with new varieties at affordable price points.
"These measures are intended to attain segment leadership by understanding consumer preferences and meeting their expectations," it said.
While talking about bread, Britannia said it has continued to grow and strengthen its leadership in the Health Segment with superior and differentiated products like 'atta' pizza, multigrain and cheese garlic bread, etc.
The category is evolving rapidly due to the entry of new players and market consolidation, it added.
"With the entry of significant competitors and signs of consolidation in this space, your company has renewed its focus on further diversification of portfolio, strengthening manufacturing capability, expansion into new markets and e-commerce as well as Brand building through the launch of refreshed packaging and relevant products," it said.
In the international business, Britannia's strategy is to achieve growth and market share by increasing its presence among the Indian diaspora, develop new products to recruit local ethnic clusters, and establish local operations in fast-growing emerging markets like contract manufacturing, acquisitions, joint ventures, etc.
"The Export markets in Americas, Asia, and Africa that were developed in previous years shows promising growth potential and the company is focused on mainstream channel expansion and opening more white space markets, in these geographies," it said.
For the financial year ended March 31, 2021, Britannia Industries' consolidated sales were at Rs 12,883.04 crore, up 12.6 percent as against Rs 11,443.99 crore in the previous year.
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