Britannia Industries is trying to double the turnover of its dairy verticals over the after a few years. While its current portfolio can widen, plans are also afoot to increase milk procurement. The enterprise finalizing the CAPEX for the phase may also discover the opportunity to have a brand new logo other than the existing eponymous one (Britannia) and ‘Winkin Cow’ (for milkshakes). Dairy, wherein offerings are in the value-introduced segment, debts for ₹500 crores of turnover annually and remains a worthwhile vertical for the ₹10,000-crore Britannia Industries. Sources say the business had a margin of 20, consistent with cents (income before tax) in FY19. In the first area of this monetary (April to June), excessive milk expense growth adversely impacted the dairy business.
Margin-accretive
According to Gunjan Shah, Vice-President of Sales and Head of the Diary Business, Britannia plans to stay in the price-introduced segment, wherein margins are relatively better than the pouched milk category. The agency will look at “backward integration” with improvements (new merchandise) coming in through the extension of its existing services like ‘cup curds into “lengthy-shelf existence shakes.”
“The idea is to double the turnover on this category in 2-three years. We are very certain we need to live inside the value-brought space. That’s where it is margin accretive,” he told BusinessLine throughout an interview.
New merchandise While milkshakes in tetra packs had been launched closing economically, the opposite offerings it explores will be within the probiotics space. Moreover, it could also explore the fitness drink segments (low-sugar and coffee-fats services).
Probiotics are, in reality, on the scanner. But now, not right away,” Shah delivered.
According to him, the Winkin’ Cow brand of milkshakes has done “extraordinarily well” for the company. Within nine months of its launch, it’s the No. 2 brand and competes with ‘Cavin’s.’ Moreover, after the release of Winkin’ Cow, the organization has been able to ramp up its distribution base two-and-a-half times.
We may want to look at having another brand for culinary reports,” he stated.
Britannia Industries MD Varun Berry, in a recent analyst name, mentioned that within the dairy commercial enterprise (for milkshakes), the employer has “hired no capital at all,” and it’s far all “1/3 celebration manufacturing”.
Procurement
Britannia also plans to ramp up its procurement as its dairy line within the Ranjangaon facility (Maharashtra) goes on-stream. The corporation has 25-30 milk series centers within the State and collects up to 25,000 liters daily.
