Britannia Industries has announced that it will gradually undertake price hike of its products to offset a sharp rise in cost, amid uncertainty arising out of the COVID-19 pandemic. The company is being cautiously optimistic and has infused Rs 130 crore in capacity building in the current fiscal. The company was expanding the Khurda plant in Odhisa, and Tamil Nadu facility. A Greenfield unit is also coming up in Uttar Pradesh and land has already been acquired.
It is also eyeing at a greater revenue share from e-commerce which currently contributes two per cent. According to a statement released by the company, the commodity inflation was sharp during the (first) quarter (of the current fiscal). The food giant is thus, taking price calls in a calibrated and gradual way to offset the cost pressure.
The company, in the recent past, had taken price calls in value products but the constant cost pressures were not enough to match the impact, which is estimated at 5-6 per cent. Britannia had earlier posted a 29 per cent decline in consolidated net profit to Rs 389 crore for the quarter ended June 30 over the corresponding period last year.
According to company officials, it is not easy to increase the prices of the products during difficult times, and the same has been done in a calibrated approach. The company is focusing on new product launches, they said, adding that it has introduced ‘fusion snacking’ and expanded Britannia 50-50 basket. To meet demand, Britannia continues to invest in capacity building in various product lines, including dairy.