2018

Economic Analysis Report

Submitted To : Submitted By :
Prof. Manoj K. Sharma Pallavi Kapoor
UBS, Panjab University MBA B (2018-20)
Chandigarh
Contents
Acknowledgement..................................................................................................................................................................... 2
Introduction ............................................................................................................................................................................... 3
Key Management Personal........................................................................................................................................................ 5
Products..................................................................................................................................................................................... 8
Timeline ..................................................................................................................................................................................... 9
Demand Analysis ..................................................................................................................................................................... 14
Demand Determinants of Britannia Cake............................................................................................................................ 14
Ratio Analysis........................................................................................................................................................................... 17
Historical data...................................................................................................................................................................... 17
Ratios ................................................................................................................................................................................... 19
Operating Profit Ratio...................................................................................................................................................... 19
Net Profit Ratio ................................................................................................................................................................ 21
Raw Material to Sales Ratio............................................................................................................................................. 23
Labour to Sales ratio ........................................................................................................................................................ 24
Cost per employee........................................................................................................................................................... 25
Production Analysis ................................................................................................................................................................. 26
Variable Inputs................................................................................................................................................................. 26
Fixed Inputs ..................................................................................................................................................................... 26
Market Analysis ....................................................................................................................................................................... 30
Conduct of Britannia................................................................................................................................................................ 32
Vision ................................................................................................................................................................................... 32
Mission &Objective ............................................................................................................................................................. 32
Advertising Strategy ............................................................................................................................................................ 33
SWOT ANALYSIS....................................................................................................................................................................... 34
Strengths of Britannia ......................................................................................................................................................... 34
Weaknesses and Opportunities of Britannia ....................................................................................................................... 35
Threats ................................................................................................................................................................................. 37
References ............................................................................................................................................................................... 38
Acknowledgement

It gives me immense pleasure to present the analysis report on Britannia . It would

not have been possible without the kind support of Professor Manoj K. Sharma ,
under whose guidance and constant supervision the report is accomplished . I would
also like to express my gratitude towards my parents for their kind co-operation and
encouragement which helped me in the completion of this project.

I am also thankful to the to UNIVERSITY BUSINESS SCHOOL, CHANDIGARH for giving me

such an amazing opportunity for making this report , and giving a suitable
instructions and guidelines for the same .

Last but not the least, I thank my friends who communicated relevant information
and valuable web links for preparing my report.
Introduction
Britannia industries trading at 6,385 at 20-65.10 (-1.01%) At close: 27 July 3:29PM
IST. Britannia industries has 100 years of legacy with core emphasis on healthy ,
fresh and delicious food . Britannia’s product portfolio includes Biscuits, Bread,
Cakes, Rusk, and Dairy products including Cheese, Beverages, Milk and Yoghurt.
The chairman of Britannia industries Mr Nusli N Wadia and Managing Director Mr
Varun Berry . Britannia is considered as number one Indian company in biscuit
category . The major biscuits that are famous in every household around India are
Good Day, Tiger, NutriChoice, Milk Bikis and Marie Gold . Britannia exports in more
than 70+ countries.

It has around 8 power brand with turnover of more than 500 crore each.

As per annual report 2017 they have 47,00,000 plus outlets offer Britannia products
. Britannia has 3000+ dynamic workforce and a network that drives value.
Britannia started its Research and Development Centre in the year 1970 in Mumbai.

Britannia now has world class research and development centre in Bangalore which
has developed superior products that has exceptional organoleptic experience.

Britannia has always focused on quality all the manufacturing units are ISO 22000
Certified there consumer care cell is ISO 10002 certifies and some of their factories
are AIB certified.
Key Management Personal

Chairman

• Mr. Nusli N Wadia

Managing Director

• Mr. Varun Berry

Directors

• Mr. A K Hirjee
• Mr. Avijit Deb
• Mr. S S Kelkar
• Mr. Nimesh N Kampani
• Mr. Jeh N Wadia
• Mr. Keki Dadiseth
• Dr. Ajai Puri
• Mr. Nasser Munjee
• (upto 25 May,2017)
• Mr. Ness N Wadia
• Dr. Vijay L Kelkar
• (upto 31 May, 2016)
• Mrs. Ranjana Kumar
• Dr. Ajay Shah
• Dr. Y. S. P. Thorat

Auditors

B S R & Co. LLP

Chartered Accountants
Maruthi Info-Tech Centre,
11-12/1, Inner Ring Road, Koramangala,
Bangalore - 560 071.
Management Team

Mr. N Venkataraman
Chief Financial Officer( from 1st December 2016)

Mr. Amlan Datta Majumdar

Chief Financial Officer( upto 30th November 2016)

Mr. Vinay Singh Kushwaha

Vice President Supply Chain

Mr. Manjunath Desaish

Vice President -Strategy and Business Development

Mr. Sudhir Nema

Vice President-R&D and Quality

Mr. Gunjan Shah

Vice President-Sales and Bread Business

Mr. Ali Harris Shere

Vice President- Marketing

Mr. Ritesh Rana

Vice President- Human Resource

Mr. Anindya Dutta

Vice President- International business

Mr. Manoj Balgi

Head Procurement

Mr. Sarad Garodia

Head-Dairy business
Company Secretary
Mr. Rajesh Arora
(upto 30 June,2017)

Bankers

Bank of America N. A.
Bank of Tokyo-Mitsubishi UFJ
Citibank N. A.
HDFC Bank Limited
ICICI Bank Limited
Indian Bank
Standard Chartered Bank
State Bank of India
The Hongkong and Shanghai Banking Corporation Limited
UCO Bank
Products
BISCUITS

GOOD DAY
CRACKERS
NUTRICHOICE
MARIE GOLD
TIGER
MILK BIKIS
JIM JAM + TREAT
BOURBON
LITTLE HEARTS
PURE MAGIC
NICE TIME
BREADS

WHOLE WHEAT BREADS

WHITE SANDWICH BREADS
BREAD ASSORTMENT
DAILY BREADS
DAIRY
CHEESE
FRESH DAIRY
ACCOMPANIMENTS
CAKES

BAR CAKES
VEG CAKES
CHUNK CAKE
NUT & RAISIN ROMANCE
MUFFILLS
BISCOTTI
RUSK
PREMIUM BAKE
Timeline
In year 1892 Britannia was established in Kolkata with an investment of just Rs295
The Company began its operations on 21st March 1918, as a public limited company
under the Indian Companies Act, VII of 1913. The Company manufactured bakery
and soybean products, export of cashew Kernels marine products, general
merchandise items and computer software.
In year 1921 Britannia became first company to run and install gas oven plant.
In year 1924-1966 it conducted major activities like establishing a new factory at
Kasara Pier Road in Mumbai. It started manufacturing special service biscuit during
World War II ,95% of companies wealth under this utilized . In year 1961 it started
producing bread in and also a bakery was developed in Delhi four years later.
In the year 1980 company signed a 10 year technical collaboration agreement with
Nebico Pvt. Ltd., Nepal, for the supply of know-how relating to manufacturing,
packaging and marketing of biscuits and selection of plant and machinery.
A biscuit line famous till date named Good Day was launched in year 1989.
During 1991 the Company launched two new speciality brands viz., Britannia milk
bread and Britannia brown bread in Delhi and extended nationally its main brands
Petit Beurre and elaichi cream. - On 17th August, the Company handed over to SM
Dychem Ltd, its soya unit at Vidisha, MP. - The Company proposed to invest in the
equity capital of Britco Company Pvt. Ltd., a joint venture with JMRPCO Ltd.,
Hongkong, for manufacture of beverage bases and essence for Coca Cola, Fanta &
Sprite and to export processed snack foods.
In years 1992 and 1993 company launched namely `Little Hearts' which carved a
niche in the market and fifty –fifty.
In the subsequent years company tried and tested following products IN year 1994
bakery devison launched a special biscuit to target fitness conscious consumers
name “Thinlight.”I t also launched “Bakes Choice” a similar biscuit in same year.
Similary in year 1995 and 1996 company floated “Pure Magics” and Mariegold
biscuits registered quantum growth in volumes and milk bikis milk cream launched
during the year was well received. Despite general slow down in the economy the
company's profits improved.
In following years government adopted lenient policies which assisted company to
diversify and expand its operation and opened gates for it a plethora of growth
opportunities. The Company undertook to diversify into cheese and dairy whitner. -
The Company launched `Tiger' range of biscuits for mass market category, `Jim-
Jam' and ` `Chekkers' in the premium segment. The Company also launched Butter
in Delhi during the year. - Britannia Industries (BIL) is one of the largest bakery in
the private sector and a household name in food products. - Britannia Industries Ltd
(BIL) will shortly enter the cheese and milk products market with an alliance
proposed between itself and the Mumbai-based Dynamix Dairy Ltd. - Britannia
Industries Ltd is all set to launch a new corporate identity and a total revamp of its
product portfolio, with strategic inputs from an international strategic design and
brand repositioning company - Shining Strategic Design.
1998 - Food major Britannia Industries Ltd (BIL) has signed a wage agreement with
the Maharashtra General Kamgar Union (MGKU), providing an average wage
increase for 1,000 workers employed in the biscuit manufacturing unit at Reay
Road, Mumbai. - The company has launched Half/Half in the same year
1999 - Britannia Industries Ltd has rolled out its flavoured milk brand `Zip-Sip' in
tetrapaks. Zip-Sip has been launched in Mumbai and some markets in the South. -
Britannia Industries, launching the country's first branded flavoured milk is another
step towards its goal of becoming a dairy-products giant. - In a move meant to
sharply increase its India-profile, `know/ledge major' Encyclopaedia Britannica Inc
plans to come out - for the first time - with India and south Asia-specific volumes
targeted at school children as well as institutions and the general `knowledge-
seeker'.
2000 - Over 1999-2000, Britannia has diversified from its conventional bread and
biscuits business, into dairy products such as cheese, flavoured milk and butter.
Judging by the 44 per cent volume growth and the good market shares it managed to
garner in the dairy business by March 2000, this foray appears to have been
reasonably successful.
In the core biscuits business, the company's new brand targeted at the mass market
(under the Tiger banner), its brand extensions (Nutrichoice and Junior) have helped
to ward off plateauing of sales. Judging by the 16 per cent growth in topline and the
27 per cent growth in net profit in the first quarter of 2000-01, the company appears
to have weathered the excise duty hikes reasonably well, posting an improvement in
operating margins despite having to absorb part of the hike in tariffs.
Two key challenges now appear to lie ahead for Britannia. On one hand, its
traditional dominance of the biscuits market is now challenged by competition from
a host of multinational brands (Sara Lee, Nestle and McVities, to name a few), many
of which have found their way into India with the relaxation of import restrictions
on consumer products. These brands do pose a threat to Britannia at the premium
end of the market. But Britannia's long-established national distribution reach and
its mass market presence are likely to stand it in good stead for some time to come.
On the other hand, the result of Britannia's forays into entirely new product
categories such as snacks and dairy products is also yet to be fully felt. In the initial
years, at least, the promotional outlays on these product categories is likely to absorb
cash flows from Britannia's mature businesses. However, given the largely untapped
potential in these product categories and the urgent need to broadbase its product
portfolio, the risks that Britannia appears to be taking on this count appear justified.
The ability to leverage on an existing distribution network affords Britannia a first-
mover advantage, not available to many of its competitors.
After taking into account these factors, the Britannia stock, now trading at a price-
earnings multiple of around 37 times its 1999-2000 per share earnings, appears to
be a good investment proposition for investors with a two-to-three year time
horizon.
2001 - Britannia Industries has launched Britannia Milkman Milk in Delhi. -
Biscuits major Britannia Industries will fund its in-principle agreement to acquire
49 per cent of Kwality Biscuits through internal accruals.
2002 -Britannia Industries Ltd announced on March 26, 2002 that it has entered
into a joint venture with the Fonterra Cooperative Group, New Zealand's biggest
company and one of the leading diary co-operative groups in the world. -Britannia's
new COO is Nikhil Sen.
2003 - Board of Directors of Britannia Industries Ltd has passed a resolution to
terminate the employment of Mr S K Alagh as Managing Director of the company
with immediate effect. - The management of Britannia Industries has roped in John
Miller, a Danone representative, as additional director on its board. -Britannia New
Zealand Foods, a joint venture of Britannia Industries and Fonterra Co-operative
group of New Zealand has launched "Britannia MilkMan" fresh milk. -Britannia's
Non-convertible Debentures have been rated AAA by Fitch Rating India as "Stable
Outlook". -Britannia Industries has appointed Mr.Nikhil Sen,Chief Operating Officer
as the manager of the company.
2004 -Britannia Industries Ltd has informed that pursuant to the approval of the
shareholders of the Company at the AGM held on August 08, 2003 and the
subsequent application to the Cochin Stock Exchange Ltd., the said stock exchange
has delisted the securities of the Company with effect from November 15, 2003. -
Britannia Industries Ltd reviews marketing alliance with the Kolkata-based Thacker
Dairy Products Pvt Ltd -Britannia accorded the status of being a 'Superbrand' -
Volumes cross 3,00,000 tons of biscuits -Good Day adds a new variant - Choconut -
in its range
2005 --Britannia New Zealand launches health drink for adult -Re-birth of Tiger -
'Swasth Khao, Tiger Ban Jao' becomes the popular chant! -Britannia launched
'Greetings' range of premium assorted gift packs -The new plant in Uttaranchal,
commissioned ahead of schedule. -The launch of yet another exciting snacking
option - Britannia 50-50 Pepper Chakkar
2006 -Britannia Industries Ltd has forged a strategic alliance with "CCD Daily
Bread Pvt Ltd" a Bangalore based Company engaged in manufacturing and retailing
of premium breads, cakes and high end ready to eat foods and snacks -Britannia
Industries Ltd has appointed Mr. Stephan Gerlich as a Director. -Britannia
Industries Ltd has informed that Mr. Durgesh Mehta has joined the Company as the
Chief Financial Officer (CFO) with effect from November 16, 2006. -Britannia re-
launched NutriChoice Hi-Fibre Digestive biscuits in an international large sized
biscuit pack.
2007 -Britannia industries formed a joint venture with the Khimji Ramdas Group
and acquired a 70 percent beneficial state in the Dubai-based Strategic Foods
International Co. LLC and 65.4% in the Oman-based Al Sallan Food Industries Co.
SAOG. -Britannia NutriChoice SugarOut range introduced - 1st of its kind of biscuits
to be be launched in India with "No Added Sugar" (Variants - Chocolate Cream,
Orange Cream, and Litetime)
2008 -Britannia NutriChoice 5 Grain biscuits launched - Biscuits with the goodness
of 5 health Cereals, and sweetened with Natural honey. Britannia Nutrichoice
promised consumers "Bhook Bhagao, Kuch Healthy Khao" -Britannia launched Iron
fortified 'Tiger Banana' biscuits, 'Good Day Classic Cookies', Low Fat Dahi and
renovated 'MarieGold'.
2009 -Britannia NutriChoice Nature Spice Crackers launched - Your favorite Cream
Crackers, now made even more exciting with the addition of "Sabut" Ajwain and
Jeera spices.
2010 -Britannia NutriChoice launches a New Year pack - the Health Starter Kit.
Created for everyone who makes New Year resolutions and doesnt follow through.
The Health Starter Kit contains 1 pack each of NutriChoice Hi-Fiber Digestive,
NutriChoice 5 Grain, NutriChoice Nature Spice Cracker bundled together with a Fit
Sip Sipper and a fitness chart. All this only for Rs 100. 2010 - Britannia Industries
Ltd has appointed Dr. Vijay L. Kelkar as an additional Director on the Board of the
Company with effect from May 28, 2010. - Company has splits its Face value of
Shares from Rs 10 to Rs 2
2011 -Britannia received the Most Respected Company Award 2011 from
Businessworld. -Bourbon received the Most Popular Confectionery Product
Preferred By Youth (Biscuit) Award. -Britannia Bread launched its new range of
Health Breads in Delhi in November. The range consists of Honey & Oats Bread,
Multi-Grain Bread, 100% Whole Wheat Bread and Multi-Fiber Bread. -BRITANNIA
was honoured with `CREATIVE HR PRACTICES AWARD' by Employer Branding
Institute, India, on the occasion of 6th Employer Branding Awards ceremony held
on the 10th of December 2011 at Hotel Taj Deccan, Hyderabad.
2012 -IMC Ramakrishna Bajaj National Quality Award 2011 was awarded to
Britannia Industries Limited. -The Modern Trade team of Britannia was honoured
with Winner-BEST BAKERY SUPPLIER award for the year 2011-12, at the 1st
SPENCER'S Best Supplier Awards 2012 on 22nd June. -Britannia was awarded the
Global Performance Excellence Award (GPEA) by Asia Pacific Quality Organization
(APQO)
2013 -Britannia Industries Ltd.-Kolkata was selected the winner of the GOLDEN
PEACOCK NATIONAL QUALITY AWARD for the year 2012. -Britannia bagged the
prestigious IWLF Award for 'Solid Waste Management Project' and 'BNF' project at
the International Women Leadership Forum held in Mumbai on 25th April 2013. -
Britannia recommends a dividend for the year ended March 31, 2013 at the rate of
Rs. 8.50 (Rupees Eight and Paisa Fifty Only) per equity share of Rs. 2/- each to the
eligible members.
2014 -Britannia recommends a dividend for the year ended March 31, 2014 at the
rate of Rs. 12/- (Rupees Twelve Only) per equity share of Rs. 2/- each to the eligible
members.
2016 -Britannia awarded The esteemed jury from Renewable Energy India Awards
Cake Biscotti | Britannia launches Cake Biscotti, India’s first ever classic 'Bridge'
product combining the best of the world of a cake and that of a cookie.
Cutting - edge technology | Britannia launched its state of the art R&D Centre facility
in Bidadi, Karnataka.

2016 -selected Britannia for a special recognition under the Leading RE Investor
category.
2017 -Britannia has signed a non-binding Memorandum of Understanding (MOU)
with Chipita, a Greek company for exploring certain business opportunities.
Demand Analysis
Demand Determinants of Britannia Cake

Price: Price is most important demand determinant of any product. Price is the
quantity of payment given by one party to another in return of for 1 unit of goods and
services.
Price of Britannia fruit bar cake lies between rupees 15 to 30 in retail market and it
clearly follows law of demand for example another variant of Britannia bar cake
named as nut and rasin pricing MRP 50 has less demand in comparison to
ordinary Britannia cakes having MRP less than or equal to 30 .

Income level and consumption pattern : Being a fast moving consumer good
(FMCG) it is not much impacted by the income levels of consumers. But it do effect
demand for example As there is rural urban divide in the India . The sale of
Britannia cake is more in urban areas in comparison to rural areas.
Competition: Many companies provide cakes , cup cakes and other forms of
cake having different price ranges . Few competitors of Britannia cake are :
Bagels & Bakes, Bauli, BHealthy,Bisk Farm, CakeesDezire,Dream, BakeEliteFresho
,Signature,LLUVIA, BAKERYMilk Ma,Nairns,Parle,Pillsbury,Winkies
Climatic conditions : Since cake is a perishable community it has to be stored in
an cool temperature .It can't be stored in a hot climatic conditions hence it is
available for sale with retailers who have such storage facilities .This affects its
availability in areas with warm, hot climatic conditions and hence effects its
demand. Availability of cake is less in areas with hot climatic conditions.
Policies: government taxation policies and other laws of country can increase and
decrease demand of any product . 18% goods and services tax is levied on the
Britannia cake currently which led to increase in demand and four percent increase
in sales.
Taste and Preferences : Consumer is preferring Britannia cake for generations
now due to good quality . Since modern recipes and variants of biscuits and cakes
are evolving its demand is shifting to such products. For example towards waffles,
donuts.
Substitute: There are many substitutes available to a Britannia bar cake as it is
utilized as sweet dish or snack it has substitutes chocolate, biscuits ,toast , pastries
and even Indian sweet dishes like Rasgulla and Gulab Jamun.

Advertisement : Britannia fruit had various advertisements for example in year

2009 it is shown the Britannia bar cake is replacement for Indian food Idli and
chocolates . It had a theme that it is healthy and delicious for the kids with the
tagline “ kuch healthy kuch masti”.
In year 2010 another advertisement was made where in a small kid is shown with
a cow, a tree and a hen but the Britannia bar cake is shown as replacement of all
the three and the tagline was
“ achaiyo sai bhara”
Another advertisement in 2016 was launched with tagline “yummy wali Shararat”
and in that a father shown equally excited about the cake as that of his son . This
advertisement was made to depict and promote the idea that the cake is not just for
the kids but also for middle aged people. This depicts advertisement can affect the
products demand. It was mostly demanded by the kids but in advertisement the
father was also shown equally excited about the cake. This led to increase in
demand for product among middle age group people
Expectations of consumer.: A consumer expects a cake to be fresh ,spongy,
fluffy, spongy ,sufficiently sweet, it should look good made of good quality
ingredients .The texture of cake should also be amazing . Any negative variance
would lead to decrease in demand and Britannia has managed to keep the quality
standard which has led to constant or growth in demand.
Cultural and eating practice; To cater to all the cultural practices followed All
Around The World Britannia bar Cake is available in two variants that is with egg
and without egg. Eating egg and meat is tabooed by certain cultures in India
like Lingayat, Vaishnav Community, Jain community and then Brahmins .In such
cultures demand for bar cake with egg is zero and hence is culture is important
determinant.
Economic Cycle : The economic cycle is fluctuation of the economy between
growth and recession. Demand for every product increases during growth and
decreases during recession for example during demonetization Indian economy had
recession so demand for every product declined including Britannia bar cake and
hence economic cycle is major determinant.
Emerging issues: Emerging issues and trends like waste dumping low pollution
control population growth , depletion of ozone layer is major area of concern for any
business . Consumers are well aware and educated these days . They generally
prefer the product and company that is environment friendly and they promote the
company following green practices. A disposable packaging material utilized and
adopting , socially responsible business practices is an important demand
determinant of any modern product. Since the cake is utilized for eating purposes it
is more important for such product to follow socially responsible practices.

Parent company practices : Demand of any product is affected by the practices

adopted by the company and its Parent company . The parent company of Britannia
is Wadia Group with its headquarters in Mumbai which has an good image .Any
malpractices found or adopted in one product will affect the demand of other product
of the company as well , for example Maggi when it was reported the contents of
Maggie are not good for health it affected each and every product of Nestle .
Ratio Analysis
Historical data

Net Sales/Income
Consumption of Raw Net Profit/(Loss) For
Year from operations
Materials the Period
standalone

Mar '18 9205.93 4405.17 947.89

Mar '17 8311.53 4342.78 843.69
Mar '16 7651.64 3812.06 763.31
Mar '15 7100.46 3592.99 622.41
Mar '14 6232.09 3165.53 369.83
Mar '13 5564.38 2890.42 233.87
Mar '12 4947.04 2655.01 186.74
Mar '11 4219.97 2371.92 145.29
Mar '10 3416.6 1877.14 116.5
Mar '09 3157.79 1767.06 180.4
Mar '08 2617.7 1479.4 191
Mar '07 2317.1 1351.1 107.6
Mar '06 1817.9 929.4 146.4
Mar '05 1615.4 749.4 148.8
Mar '04 1470.5 675.1 118.8
Mar '03 1349.1 548 99.1
Mar '02 1451 503.9 203.2
Mar '01 1332.5 504.3 70.5
Mar '00 1165.5 -- 51
Mar '99 1030.1 -- 39.6
Mar '98 847.84 -- 28.93
Mar '97 752.33 17.88
Mar '96 602.38 16.01
Mar '95 518.87 18.39
Mar '94 442.85 17.43
Mar '93 447.85 12.85
Year Revenue Labour No. of Employees Operating Profit

Mar '18 9464.17 294.87 3800 1410.48

Mar '17 8608.4 241.68 3200 1204.15
Mar '16 8042.9 216.24 3000 1131.82
Mar '15 7431.06 176.79 2600 771.5
Mar '14 6334.79 172.45 2405 596.62
Mar '13 5681.12 143.5 2386 371.53
Mar '12 5037.51 145.87 1987 279.23
Mar '11 4290.33 119.93 1994 231.48
Mar '10 3378.57 99.52 2010 207.45
Mar '09 3163.2 96.02 224.16
Mar '08 2590.93 90.5 232.32
Mar '07 2255.09 76.7 128.69
Mar '06 1747.91 73.1 200.96
Mar '05 1631.78 71.6 183.94
Mar '04 1507.61 82.1 161.43
Mar '03 1337.54 85 147.15
Mar '02 1537.05 94.2 136.24
Mar '01 1307.71 95.3 120.91
Mar '00 1158 -- 87.65
Mar '99 --
Mar '98 --
Mar '97
Mar '96
Mar '95
Mar '94
Mar '93
Ratios

Operating Profit Ratio

This ratio is a modified version of Net Profit ratio. It studies the relationship between
operating profit (also known as PBIT — Before Interest and Taxes) and sales. The
purpose of computing this ratio is to find out the amount of operating profit for each
rupee of sale. While calculating operating profit, nonoperating expenses such as
interest, (loss on sale of assets etc.) and non-operating income (such as profit on
sale of assets, income on investment etc.) have to be ignored. The formula for this
ratio is as follows:

Operating Profit Ratio of Britannia has increased over time due to increase in
operating profit more than increase in net sales.
 Net
Sales/Income
from Operating
operations Operating Profit
Year standalone Profit Ratio
Mar '18 9205.93 1410.48 15.3214
Mar '17 8311.53 1204.15 14.4877
Mar '16 7651.64 1131.82 14.7919
Mar '15 7100.46 771.5 10.8655
Mar '14 6232.09 596.62 9.57335
Mar '13 5564.38 371.53 6.67693
Mar '12 4947.04 279.23 5.64439
Mar '11 4219.97 231.48 5.48535
Mar '10 3416.6 207.45 6.07183
Mar '09 3157.79 224.16 7.09864
Mar '08 2617.7 232.32 8.87497
Mar '07 2317.1 128.69 5.55393
Mar '06 1817.9 200.96 11.0545
Mar '05 1615.4 183.94 11.3867
Mar '04 1470.5 161.43 10.9779
Mar '03 1349.1 147.15 10.9073
Mar '02 1451 136.24 9.38939
Mar '01 1332.5 120.91 9.07392
Mar '00 1165.5 87.65 7.52038

Operating Profit Ratio

18
16
14
12
10
8
6
4
2
0
Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Net Profit Ratio

This ratio is called net profit to sales ratio and explains the relationship between net
profit after taxes and net sales. The purpose of this ratio is to reveal the amount of
sales income left for shareholders after meeting all costs and expenses of the
business. It measures the overall profitability of the firm. The higher the ratio, the
greater would be the return to the shareholders and vice versa. A net profit margin
of 10% is considered normal. This ratio is very useful to control costs and to
increase the sales. It is calculated as follows:
 Net Sales/Income
from operations
Year standalone Net Profit Net Profit Ratio
Mar '18 9205.93 947.89 10.30
Mar '17 8311.53 843.69 10.15
Mar '16 7651.64 763.31 9.98
Mar '15 7100.46 622.41 8.77
Mar '14 6232.09 369.83 5.93
Mar '13 5564.38 233.87 4.20
Mar '12 4947.04 186.74 3.77
Mar '11 4219.97 145.29 3.44
Mar '10 3416.6 169.36 4.96
Mar '09 3157.79 180.4 5.71
Mar '08 2617.7 232.32 8.87
Mar '07 2317.1 128.69 5.55
Mar '06 1817.9 200.96 11.05
Mar '05 1615.4 183.94 11.39
Mar '04 1470.5 161.43 10.98
Mar '03 1349.1 99.16 7.35
Mar '02 1451 203.17 14.00
Mar '01 1332.5 70.54 5.29
Mar '00 1165.5 51.02 4.38

Net Profit Ratio

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

0.00
Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
Raw Material to Sales Ratio

Year Net Sales/Income from Consumption of Raw Materials Raw

operations standalone Material
to sales
Mar '18 9,205.93 4,405.17 47.85
Mar '17 8,311.53 4,342.78 52.25
Mar '16 7,651.64 3,812.06 49.82
Mar '15 7,100.46 3,592.99 50.60
Mar '14 6,232.09 3,165.53 50.79
Mar '13 5,564.38 2,890.42 51.95
Mar '12 4,947.04 2,655.01 53.67
Mar '11 4,219.97 2,371.92 56.21
Mar '10 3,416.60 1,877.14 54.94
Mar '09 3,157.79 1,767.06 55.96
Mar '08 2,617.70 1,479.40 56.52
Mar '07 2,317.10 1,351.10 58.31
Mar '06 1,817.90 929.4 51.12
Mar '05 1,615.40 749.4 46.39
Mar '04 1,470.50 675.1 45.91
Mar '03 1,349.10 548 40.62
Mar '02 1,451.00 503.9 34.73
Mar '01 1,332.50 504.3 37.85

Raw Material to sales

70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar
'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18

Raw Material to sales

Labour to Sales ratio

Year Net Labour Labour

Sales/Income to
from sales
operations ratio
standalone
Mar '18 9205.93 294.87 3.20
Mar '17 8311.53 241.68 2.91
Mar '16 7651.64 216.24 2.83
Mar '15 7100.46 176.79 2.49
Mar '14 6232.09 172.45 2.77
Mar '13 5564.38 143.5 2.58
Mar '12 4947.04 145.87 2.95
Mar '11 4219.97 119.93 2.84
Mar '10 3416.6 99.52 2.91
Mar '09 3157.79 96.02 3.04
Mar '08 2617.7 90.5 3.46
Mar '07 2317.1 76.7 3.31
Mar '06 1817.9 73.1 4.02
Mar '05 1615.4 71.6 4.43
Mar '04 1470.5 82.1 5.58
Mar '03 1349.1 85 6.30
Mar '02 1451 94.2 6.49
Mar '01 1332.5 95.3 7.15

Labour to Sales ratio

8

0
Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar
'18 '17 '16 '15 '14 '13 '12 '11 '10 '09 '08 '07 '06 '05 '04 '03 '02 '01
Cost per employee

Year Labour No. of Employees Cost per employee

Mar '18 294.87 3800 7.76

Mar '17 241.68 3200 7.55
Mar '16 216.24 3000 7.21
Mar '15 176.79 2600 6.80
Mar '14 172.45 2405 7.17
Mar '13 143.5 2386 6.01
Mar '12 145.87 1987 7.34
Mar '11 119.93 1994 6.01
Mar '10 99.52 2010 4.95

Cost per employee

9.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
Mar '10 Mar '11 Mar '12 Mar '13 Mar '14 Mar '15 Mar '16 Mar '17 Mar '18

Cost per employee

Cost per employee has increased and overtime but it has also decreased in Mar 15 and Mar 13.
Production Analysis
In economics, production theory explains the principles in which the business has to
take decisions on how much of each commodity it sells and how much it produces
and also how much of raw material ie., fixed capital and labor it employs and how
much it will use. It defines the relationships between the prices of the commodities
and productive factors on one hand and the quantities of these commodities and
productive factors that are produced on the other hand.

Production analysis basically is concerned with the analysis in which the resources
such as land, labor, and capital are employed to produce a firm’s final product. To
produce these goods the basic inputs are classified into two divisions −
Variable Inputs
Inputs those change or are variable in the short run or long run are variable inputs.
Fixed Inputs
Inputs that remain constant in the short term are fixed inputs.
Britannia Production Analysis

Ratio
Total Output
Year Output Labour Capital
Input to
Input
Mar-91 3185 294.3 185.7 480 6.635417
Mar-92 3650.7 337.6 185.7 523.3 6.976304
Mar-93 4319.2 379.4 185.7 565.1 7.643249
Mar-94 4478.5 412.5 185.7 598.2 7.486627
Mar-95 4801.3 452.7 185.7 638.4 7.520833
Mar-96 5655.8 508 185.7 693.7 8.153092
Mar-97 6591.6 586.3 185.7 772 8.538342
Mar-98 8203.6 683.6 185.7 869.3 9.437018
Mar-99 8478.4 725.7 185.7 911.4 9.302611
Mar-00 10301 829.1 185.7 1015 10.15116
Mar-01 11698 924 278.5 1203 9.728399
Mar-02 13325 993.5 278.5 1272 10.47579
Mar-03 14510 997.4 268.5 1266 11.46204
Mar-04 13491 973.2 259 1232 10.9483
Mar-05 14705 961.2 251.1 1212 12.13008
Mar-06 16155 872.9 238.9 1112 14.53004
Mar-07 18179 865.5 238.9 1104 16.4607
Mar-08 23831 888 238.9 1127 21.14713
Mar-09 26170 1057.2 238.9 1296 20.19119
Mar-10 32242 1240.3 238.9 1479 21.79678
Mar-11 34784 1323.8 238.9 1563 22.25872
Mar-12 43059 1199.3 238.9 1438 29.93951
Mar-13 50256 1458.7 238.9 1698 29.60409
Mar-14 56979 1435 239.1 1674 34.03572
Mar-15 64074 1724.5 239.9 1964 32.61775
Mar-16 73405 1906.5 239.9 2146 34.19917
Mar-17 81748 2092.1 240 2332 35.05356
 Britannia Input
2500

2000

1500

1000

500

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

Labour Capital Total Input

Descriptive Statistics

Mean Std. N
Deviation

outp 24010.23 22921.719 27

ut 33 86

labou 967.4926 470.48405 27

r

capit 224.5444 32.40772 27

al
Correlations

output labour capital

Pearson output 1.000 .950 .427

Correlation labour .950 1.000 .608

capital .427 .608 1.000

Sig. (1-tailed) output . .000 .013

labour .000 . .000

capital .013 .000 .

N output 27 27 27

labour 27 27 27

capital 27 27 27
Market Analysis

Market is a place where buyers and sellers meet and exchange goods or services. There are
certain conditions which create the structure of a market. Such conditions can be condensed in the
following –
• Number of Buyers
• Number of sellers
• Buyer Entry Barriers
• Seller Entry Barriers
• Size of the firm
• Product Differentiation and Homogeneous Products
• Market Share
• Competition

Britannia has served almost 45,000 villages and it has 18 Crores households. Currently it has 52
Lakh retail outlets.

Since Britannia is a FMCG companies and there are many sellers of FMCG products in India so
the big and small competetiors of Britannia are :
Parag Milk Foods Ltd.Mumbai parag milk foods ltd, ITC FMCG,Mcnroe Consumer Products Pvt.
Ltd,Amul
Chevon Agrotech Pvt. Ltd ,Aachi Masala Private Limited ,Godrej Consumer Products
Limited,Dabur India Ltd.
Emami,Eastern Condiments ,Zydus Wellness,Pidilite Industries, Wipro Consumer Care & Lighting
Ltd.,Marico, TIPPU WORLD ,Future Consumer Enterprises Ltd., Parle Agro, Jyothy
Laboratories,Haldiram's ,Nirma, Himalaya Healthcare Ltd.,Bikanervala , Manpasand Beverages
Limited, Hindustan Unilever, Patanjali Ayurved,Balaji Wafers, Nestle,PepsiCo,Coca-Cola India,
Ramdev Namkin, Keventers agro
Market Share
In our provided area the share of the market is as follows.
BRITANNIA 33%
BISKFARM 25%
PRIYAGOLD 13%
PARLE-G 14%
PURE FOOD 8%
OTHERS 7%
When we compared with other businesses then we follow the quality, price, distribution system,
promotional strategy etc. of the competitors Britannia in this area is doing well.

MARKET SHARE
Others
Pure Food
Britannia
Parle G

Priyagold

Biskfarm
Conduct of Britannia
Vision

Britannians have the highest respect for one another. They encourage people to
work in cross functional teams with a concerted aim of sharing knowledge. They are
accountable to ourselves for delivery to our consumers. They deliver continuous and
sustainable financial performance for the company and all its stakeholders.

,It's not hard to make decisions when you know what your values are”. Those
words capture, in a nutshell, what Britannia believe in. The foundation is built on the
core values that they stand by and demonstrate through their actions every single
day.
LEADERSHIP
They have the valor to shape a better future for all our stakeholders.
OWNERSHIP
They hold ourselves accountable for consistent, sustainable results by focusing on
opportunities & eliminating obstacles, internal or external.
PASSION FOR LEARNING
They apply thought, creativity & sound business judgment to meet aggressive goals
& continually invest in people, products & processes.
RESPECT
They value all stakeholders, our communities & the environment and treat them with
dignity and respect.

Mission &Objective

Their core emphasis across portfolios is on healthy, fresh and delicious food.
Britannia believes that ‘Taste & Trust’ are its sobriquet and will constantly endeavor
to make a Billion Indians reach out for a delightful and healthy Britannia product
several times a day!
The company set up the Britannia Nutrition Foundation in 2009, and began working
on public private partnership to address malnutrition amongst under-privileged
children and women.
Britannia Nutrition Foundation (BNF) currently spearheads our mission to secure
every child’s right to healthy growth and development through the ‘Right to Nutrition’
programme.
Advertising Strategy

To mark the 100 year milestone , The new advertising strategy comprises ten films
featuring consumers across age groups sharing how Britannia products have played
a crucial role in their lives.
“From a six-year old to an octogenarian everyone consumes Britannia products. We
are a part of billion Indian consumers’ lives by playing multiple roles through our
brands. The campaigns highlight different kind of consumers consuming various
Britannia products and how these products change the life of the consumers
The campaign consists of ten product films which will go on television and digital.
We will also be creating content on digital along with radio, outdoor, print and
activation.
Britannia, with a new logo and tagline ‘Exciting goodness’, aims to become a whole
foods company launching new products like wafers and croissants and entering new
categories. It will also revamp its existing products with change in formulations and
new product packaging. Good Day, 50-50, and health biscuit brand NutriChoice,
Marie Gold and Tiger Biscuits are some of the products which will be relaunched
shortly.
“Through the new brand positioning ‘Excitement and Goodness’ we want to strike a
perfect balance providing consumers both indulgent and healthy snacking options.
While our Chunkies and Bourbon fall in the indulgent category, brands such as Milk
Bikis and NutriChoice provide healthier option.
Contrary to perception, he further notes that consumers are talking about health &
wellness, but the adoption of healthy food has been slow. While the category is
growing faster than rest of the biscuits the rate of growth is not disruptive.
“But they are investing ahead for the future in our brand Nutrichoice. There are
certain barriers when it comes to healthy products price being one of the biggest
one followed by taste. In healthy biscuits, Nutrichoice is the market leader we have
more than 80% share in the premium health biscuit category. The onus is on us to
grow this category,” he added.
Britannia is also relying on the premium category for growth. It is providing premium
brands such as Chunkies cookies at Rs 5 and Rs 10 price points letting more
consumers sample the product as well as consume it on the go.
According to Narayan Devanathan, Group Executive and Strategy Officer, Dentsu
Brand Agencies South Asia, a company of the stature, respect and heritage of
Britannia doesn’t need to merely thank people and remind them of its role in their
lives in the past 100 years, but has the opportunity to highlight how they make better
things in the future.
“The “goodness” part of “Exciting Goodness” is clear enough. Mondelez’s chocolate
brand Cadbury has also added that dimension to its communication recently.
However, I couldn’t see any “exciting” bit in the Britannia campaign,” he said.
Since healthy food is an emerging topic of discussion in India, Britannia could take a
lead in that direction in its future communication.
SWOT ANALYSIS

Strengths of Britannia

Britannia has been around 120 years in the industry Britannia is one of India’s most
trusted brand with strong brand recall. Wide range of bakery products like biscuits,
rusks, cakes and dairy products like milk, butter, cheese, etc. Strong distribution
network ensuring proper availability of the products even in the remotest of areas.
Britannia has a major share in biscuits industry. Marketing and advertising
efficiency. Innovative products for health conscious people like oats and porridge,
Britannia Nutri Choice biscuits for diabetes patients, Vita Marie Gold, etc. Strong
presence in rural markets. Products for all food and snacks segments is a big boon
for Britannia
Because of its presence across range of bakery products like biscuits, rusk, cakes &
dairy products like milk, butter & cheese etc., their shelf visibility is high. Also their
focused marketing & advertising campaigns resulted into positive word of mouth .

Serving Indian Markets from last 120 years: 123 years ago, in a small house in
central Calcutta (now Kolkata) an intrepid baker made a batch of delicious, golden
brown biscuits. These were meant for officers of the British Raj and their families,
people used to the high standards of English tea-time snacking. Over the last century
and a quarter, Britannia has been serving the Indian consumer with a range of fresh,
nutritious and flavor-rich products. Today, Britannia is a leading food company in
India with over Rs. 6000 crores in revenues, delivering products in over 5 categories
through 3.5 million retail outlets to more than half the Indian population.

It has different offering for different income groups with large assortments across
the product categories like in Biscuits they have tiger ,milk bikis , Good day,
Bourbon ,little hearts, crackers , nutria-choice.

Being present in the market with such large SKU’s and making it available through
its robust distribution system, Britannia has penetrated to every nook & corner of
the country.

Britannia Industries Limited (BIL) is a major player in the Indian Foods market with
leadership position in Bakery category and has a market share of ~ 30% in the
industry. Britannia offers both delightfully indulgent and healthy choices in biscuits,
bread, cake, rusk and a range of dairy products that include cheese, curd and
specially formulated functional beverages with a dairy base.

Weaknesses and Opportunities of Britannia

Bakery

Rising aspiration of consumers enabled by higher income is the largest opportunity

for Britannia.

Past work in exploration and capability building, positions your Company to

uniquely undertake the following growth journey: 1. Disruptive innovations in the
core bakery categories of Biscuit, Cake and Rusk; 2. Expansion into adjacent bakery
categories; 3. Exploit the large and profitable international markets leveraging brand
Britannia heritage and bakery expertise and 4. Strengthening of footprint in hitherto
weaker geographies in India e.g. North and Rural.

Primary threat will be from competitors who see the same opportunities and are
investing to tap them.

A combination of consumer relevant innovations, superior quality delivery, further

expansion of distribution and the inherent strength of Brand Britannia made more
potent through judicious investments will help your Company address these threats.

Cake, Rusk, Bread & Adjacencies

Sharper economic growth, increasing consumer expectations, busier lifestyles and

consumption occasions are likely to benefit these businesses greatly: 1. New cake
formats and the availability of delightful products in convenient packages at
affordable price points.

2. Gaining from the unorganized segment, as well as opportunities to offer

consumers new rusk experiences. 3. Healthier segment in bread, as well as
geographical expansion are key opportunities. 4. Widening the ambit of adjacent
businesses, and gaining in entirely new categories can be a high growth opportunity
for your Company.

These segments are however, seeing heightened competitive activity, and the entry
of and emergence of a new generation of competitors who did not hitherto exist.
Your Company has taken serious note of such developments, and is putting in place
steps to address this. Dairy

The Dairy industry is witnessing tailwinds across most categories. These include
both value added and commoditized segments. Making the right category choices
and building differentiated capabilities and momentum in these will be critical
.Infrastructure improvement including cold chain that aids easier distribution is
another opportunity. This will be especially important in the front end, in retail
shops.

Increased competitive activity and good quality milk availability are two of the
biggest challenges seen by your Company. Differentiation in the products and
leveraging the larger sales system will be key to meeting competitive challenges. As
already mentioned, Company has started the process of building milk procurement
capabilities in order to derisk our sourcing funnel and to ensure consistency in
quality of raw material.

International Business.

The overall economic environment in GCC continues to be volatile resulting into

sluggish market demand and biscuit category growth continues to be flat or
declining in some markets. Slowdown environment and decline in consumer
demand is further accentuated through various inflationary interventions like
introduction of VAT, job layoffs & exodus of Indian diaspora in markets like KSA.
Also the Qatar crisis is envisaged

to continue and impact demand and cost to serve the market. Other large markets
for Britannia like Yemen and Libya continue to decline due to ongoing political
instability/war situation.

In the above environment, your Britannias growth will come largely through share
gain and the Company has geared up for stimulating demand through acquiring new
consumers and consumption occasions. This will be delivered through innovation in
products, packs and promotions.

Developed markets such as USA, Canada and Australia have also experienced a
slowdown in immigration. However, the Company expects rapid growth through
distribution expansion and entering new markets.

Threats
The growth of our portfolio is linked to the overall economic growth. Primary risk to
the business will be on account of adverse changes to the economy. Volatility in
commodity prices is the other significant risk. Other threats can be classified as
Lower price offering competitors can affect Britannia's market share. Local dairies
and bakeries can cause business losses. Inflation can cause fall in sales and revenue.
Rise in cost of raw materials.
References
• Annual reports of Britannia year 2000 to 2018.
• http://hsassignmentflxn.ahmedelbatrawy.us/swot-analysis-of-britannia-
biscuits.html
• https://www.moneycontrol.com/india/stockpricequote/food-
processing/britanniaindustries/BI
• https://www.mbaskool.com/brandguide/food-and-beverages/3226-britannia-
industries.html
• https://www.financialexpress.com/industry/britannia-industries-to-increase-
share-of-non-biscuits-business/1272221/
• https://www.livemint.com/Consumer/8DDutPsI8dNxpOSUeFOZNJ/Britanni
a-launches-ad-campaign-to-mark-100-year-milestone-in.html