Britannia Industries is seeing its non-biscuit portfolio growing faster than its biscuit category, in a novel development which has made analysts sit up and take notice. India?s leading publicly-held food company, which posted a 66% jump in its consolidated net profit for the September quarter, has recently introduced new products in the high fibre and diabetic-friendly categories, in a bid to fortify its health food segment. In an interview, Varun Berry, executive director and head of India operations, Britannia Industries, tells Debojyoti Ghosh & Darlington Jose Hector that the non-biscuit bakery and dairy market is providing the company a huge new opportunity. Edited excerpts:

Britannia is seeing a rise in revenues from its non-biscuit category. Isn?t this a new trend?

Our non-biscuit business is growing even faster than biscuits. This portfolio generates revenue in excess of R1,000 crore and contributes over 20% of domestic turnover. Non-biscuit bakery and dairy market is large and provides a big opportunity for us.

Product and packing innovation have always been typical Britannia features. How do you see this driving growth for the company?

Product and packaging innovation has been a key growth driver. We have introduced several new products in the market. Our endeavor is to deliver products that are inviting and have ecstatic and organoleptics appeal with packaging design that are exciting, aspirational and distinctive. This will help us drive sustainable growth and achieve our purpose of facilitating every Indian to experience Britannia products four times a day.

Input costs have remained low (sugar, palm oil) in recent times. How much has that helped FMCG companies such as Britannia?

While sugar and oil prices have been stable, dairy product prices have significantly increased in the last few months and is currently ruling firm despite flush season. Additionally, fuel prices have increased significantly and resulted in increase of input cost. We have driven profitable growth by leveraging our strong brands and focusing on fundamental levers of operation. We have also driven efficiency across the value chain and focused on complexity reduction.

Can you throw some light on the firm?s international operations?

International business is a significant growth vector for us and has delivered profitable growth. Britannia?s international business includes exports from India and the two companies in the West Asia to several countries worldwide. We have two subsidiaries in West Asia, including Strategic Food International, Dubai, and Al Sallan Food Industries.

The health food business has been a new driver for Britannia…

The health food business in India has been very active with launches, big investments in mass media and increasing retail presence. Biscuit is one of the healthiest snacking options as it is baked. We have made our products healthier with removal of transfats and addition of micro-nutrients (vitamins and minerals) to almost 50% of the volume we sell. We have a range of products that address specific health concerns. ?NutriChoice Diabetic Friendly? biscuits provides a snacking choice to diabetics. This portfolio includes oats and ragi biscuits.

What kind of work is happening on the nutrition front?

There are several initiatives that are happening on the nutrition food. Indians, especially children and women, suffer from wide spread micronutrient deficiency ? the most notable being iron deficiency anaemia. We have specially formulated iron-enriched biscuits that can supplement the main, hot meal that is given to children in school. It becomes an acceptable ?carrier? for iron supplementation. The initiative is executed through a range of partnerships with NGOs and supply of iron-enriched biscuits to government schools.

We also continue to pursue relevant partnerships with key organisations in nutrition like GAIN (Global Alliance for Improved Nutrition) and CGI (Clinton Global Initiative).

Are you planning to grow further inorganically or are you thinking of entering into more JVs?

Our goal is to deliver continuous and sustainable financial performance to all our stakeholders. Towards this, we will continue to look at all relevant opportunities in the overall foods arena.