Britannia Industries, while clarifying concerns over possible disruption to its operations due to industrial gas supply issues linked to the ongoing Middle East conflict, said it has adequate finished goods inventory and options to switch between multiple fuel types at manufacturing facilities,
Recently, to manage the shortfall of gas due to supply disruption of the Strait of Hormuz, the government has prioritised household cooking and transport fuels and curtailed industrial LNG and LPG supplies.
Britannia says it has adequate inventory, fuel flexibility
In the regulatory filing, the biscuit manufacturer said it has adequate levels of finished goods available across its supply chain network to meet market demand. It also has the option of switching between fuels, where feasible, by making technical adjustments.
“The company uses various types of fuel across its manufacturing facilities viz. LPG, PNG, Biomass, Liquid fuels etc., and has the option of switching between fuels, where feasible, by making technical adjustments,” FMCG major Britannia Industries said in its regulatory filing.
The company said it will continue to monitor developments closely and take appropriate steps to ensure continuity of operations. It also expressed confidence in its ability to manage any challenges that may arise.
What’s the concern around industrial gas supply disruption
India imports nearly 60% of its LPG requirement, and most shipments pass through the Strait of Hormuz.
The government has revised the priority order for allocating domestically produced natural gas. Under the new framework, gas supply for LPG production, compressed natural gas (CNG) for vehicles, and piped natural gas (PNG) for household cooking will receive top priority, with their full requirements to be met before supplies are allocated to other sectors.
The government has increased the price of a 14.2-kg domestic LPG cylinder by Rs 60 on March 7. It has also invoked powers under the Essential Commodities Act to direct oil refineries to maximise LPG production and prioritise supply to domestic households.
Britannia Industries share price
The share price of Britannia Industries is trading flat in the intra-day session today. The stock has declined 6.15% in the past six months.