Britannia aims to increase distribution footprint post GST

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Updated: August 14, 2017 12:31:09 PM

After facing initial GST hiccups, FMCG major Britannia is looking at increasing its distribution footprint and winning market share from local players.

GST hiccups, FMCG major Britannia, GST, post GST, BritanniaAfter facing initial GST hiccups, FMCG major Britannia is looking at increasing its distribution footprint and winning market share from local players. (Representative Image: Reuters)

After facing initial GST hiccups, FMCG major Britannia is looking at increasing its distribution footprint and winning market share from local players.
The company, which witnessed de-stocking in trade channels due to migration to GST, said the new tax regime has brought a level playing field.  “Our key strategic focus area is to increase distribution footprint, grow rural and win (market) share from local players,” Britannia said in a presentation to the analysts.  It said it would target local/regional players in specific category/geography. The company also said its other key focus areas include entering one new geography every year and enter new product categories as it aspired to be a total food company.

Last year, Britannia, whose main business segments are bakery and dairy, had entered into a joint venture (JV) agreement with Greece’s Chipita SA to manufacture and sell ready-to-eat filled croissants. Currently, the work is underway to establish operations of the JV.  It is also scouting for profitable growth opportunities, especially in the bakery segment, to strengthen its position as a leading food company in the country.  In order to increase its international business, the company said it is also evaluating entry through local manufacturing in high potential markets, which are currently not accessible through exports routes due to high trade barriers.

Britannia is present in more than 70 countries, its key geographies being West Asia, Africa, Americas, Asia Pacific and SAARC.  Britannia is also looking at driving premiumisation through innovation and attain cost leadership through efficiencies and wastage reduction.  Britannia Industries had reported a 1.40 per cent decline in consolidated net profit to Rs 216.12 crore for the June quarter, impacted by the GST roll-out and subdued growth in international business. The company had posted a net profit of Rs 219.21 crore in the April-June period a year ago. Its net sales were up 6.41 per cent to Rs 2,300.93 crore as against Rs 2,162.16 crore in the corresponding period of the previous fiscal.

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