FMCG major Britannia Industries Ltd. is planning to set up three factories, one each in the northeast, Gujarat and Andhra Pradesh, in the next three years, a top company official said on Monday.
“We are looking at putting up a factory in the North-East. An export zone factory will be set up in Gujarat. We will also put up one in Andhra Pradesh,” the company’s Managing Director, Varun Berry, said.
He said all three are expected to be commissioned in next three years.
He said that investments for each factory will be around Rs 100-150 crore and it takes 12-14 months to set up a factory.
He added that the greenfield factory at Bidadi, near Bengaluru and rusk manufacturing plant at Madurai have already been commissioned.
“If volumes go up by 8-10 per cent, we need 100,000 tonnes of capacity every year. That is the kind of additional capacity we need to put,” he said when asked about capacity addition the company is looking at.
Berry said the company would also think about setting up a new plant in West Bengal.
“We have seen quite a bit of momentum in the east. As a result of which, we will be in a position where we might run short on capacity, not immediately but in the next two years. So we have to look at Greenfield plant. So, we will engage with the government to make sure we have right location and will get our plans ready. But it is not yet finalised,” he said.
There is an opportunity to make our Taratala factory in the city more efficient, he said.
The Biscuit-maker is focusing on product innovation and is looking to enter new categories. “We are evaluating which are the categories we should enter,” he said.
On Monday, it reported a 13 per cent rise in its consolidated net profit to Rs 219.13 crore in the quarter ended June 30, 2016, as compared to Rs 193.66 crore in the corresponding period in 2015.
Its consolidated revenue in the quarter under review grew 8 per cent to Rs 2,162 crore against Rs 1,998 crore in the year-ago period.
“We continue to outpace the market with our go-to-market strategy of creating a robust distribution network with unrelenting focus on rural and our weak states. The category growths remained subdued during the quarter,” Berry said.
The deteriorating geopolitical situation and currency fluctuations in certain geographies like Middle East and Africa have also impacted our growths, he said.
Berry said the biscuit-maker intended to drive consumer off-take and strengthen its momentum through re-staging of its brands and plugging product portfolio gaps going forward.
“Commodity prices have firmed up significantly over the last two quarters and we have initiated a combination of price increase and cost efficiency measures to address this,” he said.