A Study On Biscuit Industry

A Industry Analysis Report Submitted to

Jawaharlal Nehru Technological University, Hyderabad

In partial fulfillment of the requirements

for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION

By
V.SANDHYA RANI (14881E0029)

Under the guidance of

G. RAMESH
Associate Professor
Department of Management studies

Department of Management Studies

VARDHAMAN COLLEGE OF ENGINEERING

(Permanently Affiliated to JNTUH, Hyderabad, Approved by AICTE and Accredited by NAAC

with A grade & ISO 9001:2008 certified )

Shamshabad - 501 218, Hyderabad

2014 - 2016

Department of Management Studies

VARDHAMAN COLLEGE OF ENGINEERING

(Permanently Affiliated to JNTUH, Hyderabad, Approved by AICTE and Accredited by NAAC
with A grade & ISO 9001:2008 certified)

Shamshabad - 501 218, Hyderabad

Certificate
This is to certify that the industry analysis report work entitled Biscuit
Industry is the bonafide work done By V.SANDHYA RANI
(14881E0029) in the Department of Management studies,
VARDHAMAN COLLEGE OF ENGINEERING, Shamshabad is
submitted to Jawaharlal Nehru Technological University,
Hyderabad in partial fulfillment of the requirements for the award of
MBA degree during 2014 - 2016.

Guide:

Head of the Department:

G. Ramesh
Associate Professor,
Dept of Management studies,
Vardhaman College of Engineering,
Hyderabad.

K. Jaahnavi
Associate Professor & Head,
Dept of Management studies,
Vardhaman College of Engineering,
Hyderabad.

Viva-Voce held on

_________________
Internal Examiner

ACKNOWLEDGEMENT
The satisfaction that accompanies the successful completion of the task
would be put incomplete without the mention of the people who made it
possible, whose constant guidance and encouragement crown all the efforts
with success.
I thankful to my guide G.Ramesh, Associate Professor, Management
studies for his sustained inspiring Guidance and cooperation throughout the
process of this industry analysis report. His wise counsel and suggestions
were invaluable.
I thankful to G.Suresh Kumar, Assistant Professor, Management
studies for his sustained cooperation throughout the process of this industry
analysis report.
I would like to thank K.Jaahnavi,Associate professor & Head, Management
studies for her expert guidance and encouragement at various levels of my
project.
I show gratitude to Dr. S.Sai Satyanarayana Reddy, Principal &
Management for provided all the facilities and support.
I express my deep sense of gratitude and thanks to all the Teaching and
Non-Teaching Staf of our college who stood with me during the project and
helped me to make it a successful venture.
I place highest regards to my Parents, my Friends and Well wishers who
helped a lot in making the report of this project.

V. SANDHYA RANI
(14881E0029).

DECLARATION
I hereby declare that this industry analysis report is titled Biscuit
Industry is a genuine project work carried out by me, in MBA degree
course of Jawaharlal Nehru Technology University, Hyderabad and has
not been submitted to any other course or university for the award of my
degree by me.

Signature of the Student

INDEX
S.NO :
PAGE NO:
1.

CHAPTER-I

Industry profile
INTRODUCTION
HISTORY
IMPACT ON INDIAN ECONOMY
2.

CHAPTER-II
Company profile-I
INTRODUCTION
HISTORY
PRODUCTS & SERVICES
AWARDS & ACHIEVEMENTS
FINANCIAL DATA ANALYSIS

3. CHAPTER-III
Company profile-II
INTRODUCTION
HISTORY
PRODUCTS & SERVICES
AWARDS & ACHIEVEMENTS
FINANCIAL DATA ANALYSIS
4. CHAPTER-IV
Data analysis & interpretation

Bibliography

CHAPTER

BISCUIT INDUSTRY
History
India Biscuits Industry came into major existence and started gaining a
sound status in the bakery industry in the later part of 20th century when the
urbanized society called for ready made food products at a tenable cost.
Biscuits were assumed as sick-man's diet in earlier days. But today it has
become one of the most loved fast food products for every age group.
Biscuits are always easy to carry, tasty to eat, cholesterol free and
reasonable at cost. States that have the larger intake of biscuits are
Maharashtra, West Bengal, Andhra Pradesh, Karnataka, and Uttar Pradesh.
Maharashtra and West Bengal are the most industrially developed states;
hold the maximum amount of consumption of biscuits. Even, the rural sector
consumes around 55 % of the biscuits in the bakery products.
Indian Biscuits Industry seems to be the largest among all the food industries
and has a turnover of around Rs.3000 crores. Indian subcontinent is known
to be the second largest manufacturer of biscuits, the first being USA. The
industry is classified under two sectors: organized and unorganized. Bread
and biscuits are the major part of the bakery industry and covers around 80
% of the total bakery products in India. Biscuits today stand at a higher value
and production level than bread. This belongs to the unorganized sector of
the bakery Industry and covers over 70% of the total production.

1990
In the year 1990 the total production of bakery products have risen from 5.19
lakh tonnes in 1975 to 18.95 lakh tonnes. Today Biscuits contributes to over
33 % of the total production of bakery and above 79 % of the biscuits are
manufactured by the small scale sector of bakery industry comprising both
factory and non-factory units in the country. The production capacity of wafer
biscuits is 60 MT and the cost is Rs.56, 78,400 with a motive power of 25
K.W. Indian biscuit industry has occupied around 55-60 % of the entire
bakery production. Today the large scale bakery manufacturers like Cadbury,
Nestle, and Brooke bond had traded in the biscuit industry but couldn't hit
the market because of the local companies that produced only biscuits.
Government has established The Federation of Biscuit Manufacturers of India
(FBMI) which has confirmed a bright future of India Biscuits Industry in the
year 1953. According to FBMI, a steady growth of 15 % per annum in the
next 10 years will be achieved by the biscuit industry of India. Besides, the

export of biscuits will also surpass the target and hit the global market
successfully.

Biscuit Brief introduction

Today the total production of biscuits in India is estimated to be around 30
lakh MT, the organized sector accounts for 65% and the unorganized sector
accounts for 35% of the total industry volume and the organized sector is
valued at above Rs 8000 crores. While the the biscuit industry is estimated
to grow over 15-17% in the next few years. The biscuits per capita
consumption in India is 2.0 kg. India is ranked 3rd after US and China
amongst the global biscuits producers. The export of biscuits is
approximately 17% of the annual production, the export of sweet biscuits for
year 2007-08 was Rs 145.93 Cr and for year 2008-09(April-Dec) was Rs 280
Cr, the major exporting regions were Haiti, Angola, USA, Ghana, UAE. The
imports are not significant amount as compared to the total consumption.
The penetration of biscuits in India among the urban and rural market is 85%
and 55% respectively. The annual turnover for the organized sector of the
biscuit manufacturers at 2001-02 is Rs. 4,350 crores. The annual Growth
showed a decline of 3.5% in 2000-01, mainly due to 100% hike in Central
Excise Duty (from 9% to 16%) by the government. Production in the year
2001-02 increased very marginally by 2.75% where in 2002-03 the growth is
around 3%. Government took initiatitive for the development as The Union
Budget for 2003-04 granted 50% reduction in the rate of Excise Duty on
Biscuit i.e. from 16% to 8%. The Federation's estimate indicates a growth of
approximately 8% to 9% per year.
Biscuit is always hygienically packaged nutritious snack food available at
very competitive prices, volumes and different tastes. According to the
NCAER analysis, biscuits are predominantly consumed by people from the
lower strata of society, particularly children in both rural and urban areas
with an average monthly income of Rs. 750and above.
The organized biscuit manufacturing industries annual production
Year 2003-04

2004-05

2005-06

Annual Production(Lakh MT) 11.00

17.14
19.5

2006-07

2007-08

2008-09

12.54

14.29

16.14

Biscuit Market capitalization

Biscuits Industry is the largest among all the food industries and has a
turnover of around Rs.4350 crores.

Biscuit Size of the industry

The production capacity of wafer biscuits is 60 MT and the cost is Rs.56,

78,400 with a motive power of 25 K.W. Indian biscuit industry has occupied
around 55-60 % of the entire bakery production.
The Indian Biscuit industry for the organized sector produces around 60% of
the total production, the balance 40% being contributed by the unorganized
bakeries. The industry consists of two large scale manufacturers, around 50
medium scale brands and small scale units ranging up to 2500 units in the
country, as at 2000-01. The unorganized sector is estimated to
approximately have 30,000 small & tiny bakeries across the country.

Biscuit Total contribution to the economy/ sales

Biscuit industry contribute Rs 8,000 crore to the FMCG industry today,
provides vast opportunity for growth, as the per capita consumption of
biscuits is less than 2.1 kg in our country. India is classified under two
sectors: organized and unorganized. Branded /Organized to Unbranded/Un
organized market share of biscuit has been 70% for Organized sector and
30% for Unorganized sector. Apart from Big 3(Britannia, Parle, ITC) there are
around 150 medium to small biscuit factory in India.

Top leading biscuit Companies

Parle
Britannia
Sunfeast
Priya Gold
Cremica
Dukes
Anmol
Horlicks
Biskfarm
Rose
Sobisco
Nezone

Biscuit Employment opportunities

The Biscuit industry employs almost 3.5 lakh people directly and 30 lakh
people indirectly. Britannia brand is now available in nearly 1.8 million
outlets. Britannia claims that it has a superior distribution clout with its
presence which is nearly 3.3 million outlets. Parle, the seasoned player itself,
says it is available in 1.5 million outlets. Sunfeast next step was to step up its
branding and promotion.
Biscuit Latest developments
Indian biscuit market is 1.1 million tonnes per annum at Rs 50 billion. About
90% of Indians buy and eat biscuits.
According to estimates the bakery industry in India is worth Rs 69 billion.
Out of which bread and biscuits hold about 82% of the share. The bread
market has a business volume of 1.5 million tonnes. The major factors for
growth in this segment are: Brand loyalty, volumes and strong distribution
networks.
Growth in the over 40-year-old Indian biscuit industry has remained slow.
The analyst's calculations will show that per capita consumption is less than
Rs 3 per month on biscuits or less than Rs 15 per household per month.
Back in 2003, nobody thought Sunfeast would have consumers eating out
of its hands.
According to the AC Nielsen retail sales audit in March 2006, both
Britannia and Parle have lost volumes. Britannia's shares have dropped from
35.8 % in 2004-05 to 30.5 % in May 2006 (volumes). Parle's shares have also
dropped from 42.2 to 38.4 % in the same period.
Even Priya Gold has seen a minor dip from 6.4 % to 5 %. ITC's Sunfeast
has been a big gainer with its share increasing from 2.7 to 6.7 %.

BISCUIT INDUSTRY IN INDIA - AN OVERVIEW

Biscuit industry in India in the organized sector produces around 60% of
the total production, the balance 40% being contributed by the unorganized
bakeries. The industry consists of two large scale manufacturers, around 50
medium scale brands and small scale units ranging up to 2500 units in the
country, as at 2000-01. The unorganized sector is estimated to have
approximately 30,000 small & tiny bakeries across the country.
The annual turnover of the organized sector of the biscuit
manufacturers (as at 2001-02) is Rs. 4,350 crores.
In terms of volume biscuit production by the organized segment in
2001-02 is estimated at 1.30 million tonnes. The major Brands of biscuits are

- Britannia, Parle Bakeman, Priya gold ,Elite ,Cremica, Dukes, Anupam,

Horlicks, Craze, Nezone, besides various regional/State brands.
Biscuit industry which was till then reserved in the SSI Sector, was
unreserved in 1997-98, in accordance with the Govt Policy, based on the
recommendations of the Abid Hussain Committee.
The annual production of biscuit in the organized sector, continues to be
predominantly in the small and medium sale sector before and after dereservation. The annual production was around 7.4 Lakh tonnes in 1997-98.
In the next five years, biscuit production witnessed an annual growth of 10%
to 12%, up to 1999-00.
The annual Growth showed a decline of 3.5% in 2000-01, mainly due to
100% hike in Central Excise Duty (from 9% to 16%). Production in the year
2001-02 increased very marginally by 2.75% where in 2002-03 the growth is
around 3%.
The Union Budget for 2003-04 granted 50% reduction in the rate of
Excise Duty on Biscuit i.e. from 16% to 8%. The Federation's estimate for the
current year indicates a growth of approximately 8% to 9%.
However the average utilization of installed capacity by biscuit
manufacturers in the country has been a dismal 60% over the last decade up
to 2001-02.
Though dereservation resulted in a few MNCs, i.e. Sara Lee, Kellogs
SmithKline Beecham, Heinz etc entering the biscuit industry in India, most of
them, with the exception of SmithKline Beecham (Horlicks Biscuits), have
ceased production in the country.
On the other hand, import of biscuits, specially in the high price
segment has started from 1998-99, but however, the quantum of imports
has not so far increased alarmingly and has remained at around 3.75% of the
consumption of biscuits in the country in the year 2001-02. However, recent
imports from china industries cheaper verities of biscuit, needs to be
examined with cautions, especially in the context of the price as the low
margin based domestic industry, which is operating at 60 % of the total
installed capital. Exports of biscuits from India has been to the extent of
5.5% of the total production. Export are expected to grow only in the year
2003-04 and beyond.
Biscuit is a hygienically packaged nutritious snack food available at very
competitive prices, volumes and different tastes. According to the NCAER
Study, biscuit is predominantly consumed by people from the lower strata of

society, particularly children in both rural and urban areas with an average
monthly income of Rs. 750.00.

Biscuit can he broadly categorized into the following segments:

(Based on productions of 2000-01)
Glucose 44%
Marie 13%
Cream 10%
Crackers 13%
Milk 12%
Others 8%.
In recognition of industry's obligations towards the community, being a
part of it, biscuit manufacturers supply biscuits to the social welfare agencies
in all States for the benefit of school children, senior citizens and other needy
sections of the society. FBMI Members have always responded positively to
our appeal as also by the Government, to rush truck loads of biscuits to the
people affected by earthquakes, floods, famine etc. Our industry has also
participated in supplying biscuits to the people of war ravaged Afghanistan
and presently to the Iraqi people, under the aegis of the UN.
As regards the consumption pattern is concerned. surveys and
estimates by industry from time to time indicate the average consumption
scenario in the four Zones have been more or less close to each other, as
below:
Northern States: 28%
Southern States: 24%
Western States: 25%
Eastern States: 23%

Though India is considered as the third largest producer of Biscuits after

USA and China, the per capita consumption of biscuits in our country is only
2.1 Kg., compared to more than 10 kg in the USA, UK and West European
countries and above 4.25 kg in south cast Asian countries, Le. Singapore,

Hong Kong, Thailand, Indonesia etc. China has a per capita consumption of
1.90 kg, while in the case of Japan it is estimated at 7.5 kg.

In view of the meager per capita consumption even as penetration of

biscuits manufactured by the organised sector, into rural areas in India, has
been very good during the last 10 years, as also in the metro and other
cities, small towns etc. However, in spite of this, the industry has not been
able to utilize about half of their installed capacities.
Biscuit is a comparatively low margin food product in the PMCG
(Packaged Mass Consumption Goods ) sector. The commodity is also price
sensitive, as a consequence of which, even when the Excise Duty was
doubled on biscuits in 2000-01 biscuit manufacturers, including the major
brands, were not able hike MRPs to the extend of the steep increase in the
Duty. Taxation, both Central Excise Duty as also State Sales Tax, other
miscellaneous levies i.e. turnover tax, local area tax, mandi taxes, purchase
tax, octroi etc, has been a major deterrent in the growth of the biscuit
industry. The CII Study Report has identified Biscuit as one of the products
that should treated as "Merit Good for the purpose of liberal tax policy both
by the Centre and States.
Besides lack of technology upgradation in manufacturing, packaging
etc has also been a factor affecting our industry, along with inadequate
financial credit and support particularly for the medium and small scale
biscuit units.
On the other hand, the Government of India has identified food
processing industries as a priority area to be encouraged for growth and
development and created the Ministry of Food Processing Industries (which
was till then a Dept in the Ministry of Agriculture), headed by an Ministry of
State with Independent charge.
The Food Processing Ministry has been rendering yeomen service to the
industry, of which biscuit manufacturing is an important part. The Ministry,
with the objective of enabling food processing Industries to undertake
technology upgradation diversification. expansion as also to set up new units
has formulated scheme of Grants and Financial Assistance. Please see
www.mofpi.nic.in
Other areas of concern to industries of food products like Biscuits
include multiplicity of food laws and their enforcing agencies in the Central
and State Governments with overlapping functions & implementation. At the
persistent instance of industry organizations including FBMI the Ministry of
FPI took the initiative in evolving an Integrated Food Act, harmonizing the

existing multifarious legislations enabling better compliance. The Draft

Unifled Food Bill 2002 has been prepared and now awaits approval by the
Cabinet and the Parliament, which will fulfill an important need of the
industry and pave way for accelerated development and growth.
Biscuit manufacturing as well as other bakery products like Bread etc
are agro based industries, with the major inputs - wheat flour/atta sugar, milk
vanaspati/vegetable oil etc all being agriculture produces.
Industries such as Biscuit are also languishing as they are not able to
achieve their potentials for higher production, in the absence of the concrete
food Processing Industry Policy. FBMI in close coordination with other
organizations and apex Chambers, initiated to urge the Govt of India to
formulate a comprehensive Policy Document, for smooth growth and
harmonious development of the industry. The Food Processing Industry
Policy, which has been evolved as a result of various workshops,
deliberations and representations by a large cross section of food processing
industries, is yet to be finalized. It is hoped that the Ministry of Food
Processing Industries, GOI would initiate action for implementation of the
Policy expeditiously.

Biscuit Production
According to the production figures of members available upto the
calendar year 2003, the total production was 625000 tonnes as against
475000 tonnes in the previous year. The production of biscuit for the last 11
years is as under:
1993 - 167750

1994 - 180526

1995 - 202567

1996 - 222371

1997 - 362000

1998 - 400000

1999 - 425000

2000 - 450000

2001 - 465000

2002 - 475000

2003 625000
The production of members of FBMI consist of 50% (approx) of the total
production of biscuit in the organized sector.
The production capacity of wafer biscuits is 60 MT and the cost is
Rs.56,78,400 with a motive power of 25 K.W.
Geographical distribution
Maharashtra, West Bengal, Andhra Pradesh, Karnataka, and Uttar Pradesh.

Output per annum

Biscuit industry contribute Rs 8,000 crore to the FMCG industry today
provides vast opportunity
Percentage in World Market Indian subcontinent is known to be the second
largest manufacturer of biscuits, the first being USA.

Impact of industry in India

The biscuit industry in India enjoys a comparative advantage in
manufacturing with abundant supply of the primary ingredients required by
the industry, such as wheat flour, sugar, milk, vegetable oils, etc. The
Agricultural and Processed Food Products Export Development Authority
(APEDA), set up by the Ministry of Commerce and Industry, Government of
India, has been playing an important role over the years in promoting the
export of biscuits from the country through its various initiatives like
arranging buyer-seller meets, participation in trade fairs both in India and
abroad, publicity campaigns, etc. The Federation of Biscuit Manufacturers of
India (FBMI) has come to stay as a premier forum of the organised segment
of the Indian biscuit industry. Its estimates indicate that the share of biscuit
production by the organised sector in the country is 60 per cent while that of
the unorganised segment is 40 per cent. The FBMI, through its quarterly
newsletter, disseminates important information relating to the biscuit
industry. To know about the latest developments of the industry, one can
access its website: http:// www.biscuitfederation.org/ indus_profile.htm.
Indias exports
Segmentwise export. Indias export of biscuits in 2005-06, as may be seen
from Table 1, registered an unprecedented growth of 61.06 per cent over the
previous year with sweet biscuits continuing to dominate the export market.
However, a glance at the table reveals that the share of sweet biscuits,
which accounts for the lions share of the biscuit market in the country,
underwent a marginal decline.
Biscuit is an item of mass consumption in view of its low price and high
nutrient value. In developing countries, Indian biscuits are in great demand.
Realising the growth potential in global markets, biscuit majors like Parle,
Britannia and ITC Foods have chalked out their strategies to explore overseas
markets. ITC Foods has tied up with the New York based company, House of
Spices to launch its biscuit brand Sunfeast across the USA. On the other
hand, Parle is soon spreading its wings in Russia and Bangladesh to launch
its flagship brand Parle-G. Parle-G is the largest-selling glucose biscuit brand
across the globe. Notwithstanding, Britannia still holds on to its leadership
position in the biscuit industry. The Rs 95-billion domestic biscuit industry

including the per cent growth in India as consumers are increasingly shifting
from non-branded to branded products for health reasons.
In terms of value, Britannia and Parle account for around 38 per cent share
each of the total volume of branded biscuits marketed in India. Biscuits,
along with similar packaged food products belonging to the food processing
sector, enjoy a place of pride in the country. The finance ministers recent
announcement of excise duty exemption for biscuits, not exceeding the retail
price of Rs 100 per kg, will keep a check on prices.

BUDGET
CENTRAL EXCISE DUTY ON BISCUITS
In the Union Budget 2000-01, the finance Minister who had imposed a
100% increase in the rate of Excise Duty on biscuit from 8% as a part of the
rationalisation of CENVAT and introduction of single rate of Duty did not offer
any concesison on the Budget for 2001-02. On the other hand the 50%
exemption to small packs was withdrawn. During these years and in 2002,
the Federation submitted strong representations to the Union finance

Minister seeking relief in the Excise Duty on biscuits, giving biscuit special
treatment that it deserves on account of the exceptional nature and
sensitivity to price increase.

The Federation submitted its Pre- Budget Memorandum for 2002

demanding at least 50% Excise Relief.

It is a matter of great satisfaction that the Govt. has, after 3 years,

acceded to our demand and grated reduction in Excise Duty (from 16% to
18%) in the Union Budget for 2003-2004.

INTEGRATION OF VARIOUS FOOD LAWS

The Food Processing Industry have been experiencing the adverse affect
of multiplicity of various Acts/ Rules and Regulations for food standards
under the Prevention of Food Adulteration Act Standards of Weights &
Measures Act, Food Products Order, the Meat Products Order, the Bureau of

Indian Standards & MMPO, etc. affected the Food & Food Processing Sectors.
They need to be modernised & converged.

As a consequence of various representations of industry, the Govt. of India

has decided to set up a Group of Ministers (GOM) to propose legislation and
other changes for preparing a Modem Integrated Food Law and related
regulations. The Ministry of State for Food Processing Industries is the Nodal
Ministry to coordinate the bill.

Our federation submitted its recommendations and suggested to placed

before the Group of Ministers, covering the broad frame work required for the
food legislation as well as specific issues such as:

The main objectives of the new Integrated Food Laws & its structure
Methodology of development of Standards
Provisions of Labelling
Acceptance of a basic list of additives
Matters relating to GMP, GHP & HACP
Issues related to Codex
Procedure for sampling& launching of Proseutin
Grading of violations according to the nature of discrepancy.

Recent Changes / Amendments

Prevention of Food Adulteration Rules The Ministry of Health & Family
Welfare, Govt. of India vide its Notification No. GSR 908 (E) Dt. 20.12.2001
has provided for printing of statutory symbol on all products containing
vegetarian ingredients. The notification came into effect from 20 June 2002.
As members may be aware the Govt. has earlier amended PFA Rules vide
notification No. 245(E) Dt.4.4.2001 provided for statutory printing of the
symbols of food packages containing non vegetarian ingredients. This
notification has already come into effect from 4 October 2001.
Our Federation along with apex organizations such as CII & CIFTI have
represented to Hon'ble Union Minister for Health and Family Welfare seeking

extension of a minimum period of 6 months for implementation of the

notification, particularly on account of hardships in printing vegetarian
symbol in advertisements. A delegation from the industry met the Secretary,
Ministry of Health and Family Welfare and apprised him of the hardships
faced by industry. Further follow up is in hand.

Standards of Weight and Measures (PC) Rules 1977

The Standing Committee on Food Standards has decided that the following
issues be referred to Technical Committees to look into all aspects and to
make recommendations to the Standing Committee:

(i) Revision of First Schedule as regards tolerance (maximum permissible

error.)

(ii) Deletion of Rule 11 (a) and the Fourth Schedule for declaration of
words "when packed" with net quantity declaration on packages.

At our request the representatives of industry have been included in the

Technical Committee for each zone. Members of the Technical Committees
will be visiting the factories of manufacturers for ascertaining the position
regarding industry's plea for not reducing the maximum permissible error in
weight.

BUREAU OF INDIAN STANDARDS

The Meeting of the Bakery Confectionery and Nutritious Supplements

Sectional Committee of BIS was held on 1 March 2002. The Draft standards
for biscuit were discussed. FBMI submitted its suggestions on various issues
including classification of biscuits into 5 categories sweet /semi sweet,
crackers, cookies and speciality biscuits. It has also been suggested that
separate standards should be evolved for wafers. FBMI has also represented
that proposal for Peroxide value should not be included in the standards for
biscuits and there should not be any requirement of checking biscuits for
micro biological parameters. Supporting data received from members on

total plate count, coliform count, E coli and stapylococcus aureus, etc., have
already sent to the Bureau of Indian Standards showing that bacteria cannot
remain alive at the temperature at which biscuits are baked.

OFFER OF GRANT FOR FOOD PROCESSING INDUSTRIES

The FBMI along with other organizations of industry had requested the
Ministry of Food Processing Industries to revise its assistance for promotion
of food of processing industry. Accordingly the Ministry has offered grants
unto Rs. 25 lakhs or 25% of the Capital cost for setting
up / expansion / modernisation of units in all sectors of food processing
industries. The Ministry is also presently revising its outline of assistance
under the schemes of 10 th Plan. The information has been circulated to
members vide No. FB 1nd 7 52 Dt. 1.2.2002.

SALES TAX / VAT ON BISCUITS

As members are aware, though the Empowered Committee of finance
Ministers fixed the minimum floor rate of Sales Tax on biscuits at 8%, various
State Governments are levying Sales Tax on Biscuits in the range of 8% to
16%.
The Sales Tax regime is proposed to be replaced with Value Added Tax
(VAT) from 1 April 2003. The Federation has already represented that biscuits
being a nutritious snack food product predominantly consumed by the
consumers from the lower strata of society should be included in the list of
goods at the minimum level of VAT. Representations have already been sent
to Chief Ministers and other officials concerned in Punjab, Haryana, UP,
Karnataka MP and Kerala. Many States such as Himachal Pradesh, Delhi,
Arunachal Pradesh, Kerala have however, deferred introduction of VAT. The
trading communities in Delhi, Tamil Nadu, etc. have resorted to agitations
against levy of VAT. As far as biscuit is concerned, it is learned that VAT @
12.5% is proposed to be levied by many states. FBMI has therefore, urged
States to fix the rate of VAT on biscuits at the minimum level of 4% meant for
items of mass consumption.

FOOD SAFETY AND QUALITY

The Ministry of Health and Family Welfare and the Ministry of Food
Processing Industries have formed different Sectoral Groups in order to
facilitate formulation of a proper and efficient Food Safety Programme

towards implementation of GMP , GHP and HACCP in the food industry, either
under law or voluntary.
In the Group on Bakery products sector, FBMI has been made the Convenor
of the Group with AIBMA, Society of Indian Bakers and Britannia Industries
Ltd as members. The meeting of the Sectoral Groups was held on 20 June
2002 at Nirman Bhawan New Delhi. The President, FBMI attended the
meeting. Subsequently, FBMI has submitted its objections 1 suggestion to
the Ministry of Health, Govt. of India, and the text of which is given in
Arnnexure- A.

FOOD PROCESSING INDUSTRY POLICY

As the members may he aware, the Ministry of Food Processing Industry is
presently undertaking the formulation of a comprehensive Food Processing
Industry Policy.
Our Federation has submitted its views / suggestions for appropriate
incorporation in the Policy, the text of which is given in Annexure B

TRAINING PROGRAMME IN BISCUIT MANUFACTURE

With the objective of imparting Training to the personnel in the biscuit
industry as also to prospective entrepreneurs, FBMI in collaboration with its
members and other organizations, conducts training programme in
Biscuit Manufacture for the last two decades. The XIII Training Programme
was organized at CFTRI Mysore on 28 to 30th August 2001. The XIV Training
Programme has just concluded at the Resort Country Club, Gurgaon,
Haryana, from 25th to 28th March 2003. M/s Britannia Industries Ltd and
Parle Products Ltd cosponsored both the Training Programmes.

FOOD REGULATORY MEASURES AN OVERVIEW

During the period underreport, there has been various proposals for
changes/amendments in the important Food Law affecting our industry, such
as PFA Act/Rules, Standards of Weights & Measures (Packaging Commodities)
Act/Rules, etc.
Some of the important issues in this area of Food Laws and follow up action
by FBMI are given below :-

The Dept of Consumer Affairs (Director of Metrology), Govt. of India,

proposed mandatory printing of 1st point price, in addition to MRP, for food
products like biscuit etc. Our Federation submitted objections to the said
proposals, as there has never been any grievance from consumer forums
against the biscuit industry and this would on the one hand add to the cost of
packaging/printing and on the other hand would only create confusion for the
consumers without any benefit. The proposal has been kept in abeyance.

Similarly, our Federation on its own and through apex organizations,

effectively pursued and objected to the proposed amendment in the
Standards of Weights & Measures (PC) Rules, for making 50% reduction in
the present Maximum Permissible Error in weight of biscuit (Tolerance Limit),
on the ground that various factors such as atmospheric/environmental
changes affect moisture, temperature, and consequently affect the weight of
biscuit, at both the manufacturing, marketing/retail levels, and hence the
present Tolerance Limit should be maintained. The Sub-Committee of the
Committee on Food Standards, constituted sub grounds of experts in various
Zones/States to review the issue with representatives of industry, to visit
biscuit units and recommend their view points on Tolerance Limit, together
with another proposed amendment of discontinuing with the proviso of
printing When Packed on the packages of biscuit and other food products,
which was also objected to by our Federation by representations and
meetings in the Sub Committee of the CFS. Expert from our membership
participated in this process through CIFTI. At the time of this Report, the
issues involved are under consideration/ review by the Committee on Food
Standards (CFS).

Approval of Additives

The list of various additives needed for making Biscuit is required to be

approved by the Standing Committee on Weights & Measures. The
Committee has held various sittings in this connection. FBMI has represented
on he Committee for scrutinizing various additives for which various food
processing industries have sought approval.

Prevention of Food Adulteration Act / Rules

Members reported various instances where the PFA authorities in the

States are adopting penal action, even in cases of very minor offences /
errors under the PFA Rules. FBMI suggested that such minor errors etc should
be compounded, avoiding prosecution, harassment and resultant losses to
biscuit units. This issue has also been referred to CIL and CIFTI for further
follow up.
The Govt. of India (Ministry of Health), has formulated proposals to
introduce the concepts of Hazard Analysis Control Convention Procedures
(HACCP), Good Manufacturing Practices (GMP) and Good Hygienic Practices
(GHP), as a step towards eventual adoption in the various states in
accordance with the International Codex Alumnus, in the context of trade
terms and regulatory, measures under the WTO regime.
After discussions with FBMI and other organizations, the Dept of Health
constituted Sectoral Groups on various categories of food processing
industries. The Sectoral Group on Bakery Products consisted of FBMI, as
Convener and FBMI and SIB as members. After detailed deliberations, the
Federation submitted our comments and suggestions, highlighting the
hardships that the biscuit units would face in the event of statutory
enforcement of HACCP/GMP/GHP.
The Federation suggested that the concepts of HACCP etc should be made
voluntary in the first two/three years, keeping in view the ground realities in
the bakery sector and due to the fact that the implementation of
HACCP/GMP/GHP may be beyond he financial and technical capabilities of
majority of the biscuit manufacturers and compulsory introduction of these
regulations would adversely impact the viability and may lead to closure of a
large number of bakeries in the country. FBMI, after detailed deliberations by
the Executive Committee, suggested to the Govt. of India that, in the first
instance projects for imparting training to the Managers/Executives and
workforce in the bakery industries should be organized so as to create
awareness and knowledge on these complex regulatory aspects and educate
the personnel in the industry on various aspects of HACCP etc. FBMI has
proposed to organize such Training Programs and Workshops, in collaboration
with the Dept of Health, Govt. of India. Specific project application has since
been submitted by FBMI, which is Convener or the Sectoral Group on Bakery
Industries a mentioned above.
Federation is glad to inform members that the government of India has
accepted our suggestion and as desired by the Ministry of Health, Govt. of
India, a four day Training Programme / Workshop on HACCP/GMP/GHP will be
held as per the following programme:

As members are aware, the food processing industries, including Biscuit /

Bakery segment, are subjected to and administered by a large number of
statues i.e. PFA Act / Rules, Weights & Measures Act, Packaged Commodities
Rules, MMPO / FPOA orders under Essential Commodities Act / Rules,
Agmark, BIS etc. There are much multiplicity of implementing / enforcing
Agencies / Departments for watch one of these Acts and Rules, both at
Central and State levels. Unfortunately, many a time there are instances of
overlapping and even contradictions between such Agencies / Departments.
PFA Act / Rules are recipe based, and focus on prosecution / penal action,
even for minor / technical errors etc. which are also different in the States.
Similarly, in the Standards of Weight & Measures Act and PC Rules, there
have been plethoras of amendment, and proposals for more restrictions on
the food processing industries including Biscuit and this has resulted in
unavoidable hindrances in the development and growth of the industries.
It is in this context that our Federation in close coordination with CIFTI, CII,
FICCI, PHDCCI urged he Government to evolve a single Integrated Food Law,
encompassing the existing legislations mentioned above, with main focus on
development and promotion of the Food Processing, Agro Based industries in
the country, paving way for creation of large employment generation,
consumption of varied types of safe food products of good quality, at
reasonable prices benefiting consumers particularly those in the lower and
middle segments of the society. Exports and better capacity utilization also
need to be encouraged in the proposed Integrated law, which would also
result in higher productivity and better revenue for the Central and State
Governments.
Accordingly, the Govt. formed a Group of Ministers with the Ministry of
Food Processing Industries as the nodal point and this comprehensive
exercise has resulted in the Draft Food Bill 2002 presented to the Group of
Ministers. The said Draft Food Bill 2002 has been formulated to provide for
the production, manufacture, processing and sale of safe and suitable food
systematic and scientific development of food industry, introducing new
technologies, imparting new inputs of market dynamics, and to create an
enabling environment for innovation and value additions, ensuring high
degree of objectivity and transparency and to provide for the establishment
of a Food Development an Regulatory Authority of India an the Council for
Food Standards and for matters connected therewith or incidental thereto.

FOOD LAWS A REVIEW OF THE SCENARIO

The year under report witnessed controversial development relating to

allegations against certain food processing industries such as mineral /
drinking water, soft drinks, etc. regarding contents of pesticides, heavy
metals, etc, leading to constitution of a Joint Parliamentary Committee (JPC)
and issuance of a Draft Notification by the Government of India stipulating
permissible contents of pesticides, heavy metals, etc in various food
products. FBMI interacted with the Government and with the apex
organizations of industry. The Executive Committee discussed these
developments in detail, in the context of the manufacturing process involved
in the biscuit industry.

Milestones

There are more than 2,000 organized/semi-organized bakeries and

1,00,000 unorganized bakeries in India

The bakery products are accessible to every person in India through

organized and unorganized bakeries.

Most of India population consumes bakery products in form of

traditional wheat based products (Chapati, Naans, Puri, Parathas,
etc.) and a variety of bakery products (Biscuits, cookies, croissants,
buns, breads, cakes, muffins, etc.).

The second largest producer of biscuits after USA.

Bread and biscuits most popular consist of 80% of total market

Biscuit production is mainly in the States of Maharashtra, West

Bengal, Andhra Pradesh, Bihar, Karnataka and Uttar Pradesh. The
per capita consumption is very high in States like Maharashtra,
Gujarat, Kerala and West Bengal.

Bakery products are the cheapest of the processed ready to eat

products in the country.

BRITANNIA COMPANY
HISTORY
Britannia Industries Limited (BIL) is a major player in the Indian Foods market
with leadership position in Bakery category. Its brand portfolio includes Tiger,
Marie Gold, Good Day, 50:50 and Treat. The Company was born in 21st March
of the year 1918 as a public limited company.
The Company's plants are situated in Kolkata, Delhi, Chennai, Mumbai and
Uttarakhand. In 1921, it became the first company east of the Suez Canal to
use imported gas ovens. Britannia's business was flourishing. But, more
importantly, Britannia was acquiring a reputation for quality and value.
As a result, during the tragic World War II, the Government reposed its trust
in Britannia by contracting it to supply large quantities of 'service biscuits' to
the armed forces. A new factory was established in the year 1924 at Kasara
Pier Road in Mumbai. In the same year, the Company became a subsidiary of
Peek, Frean & Company Limited, U.K., a leading biscuit manufacturing

company, and further strengthened its position by expanding the factories at

Calcutta and Mumbai.
In 1952, the Kolkata factory was shifted from Dum Dum to spacious grounds
at Taratola Road in the suburbs of Kolkata. During the same year automatic
plants were installed in Calcutta and later in 1954 the automatic plants were
installed in Mumbai plant, also in the same year the development of high
quality sliced and wrapped bread in India was initiated by the company and
was first manufactured at Delhi and a new bread bakery was set up at Delhi
in the year 1965.
Britannia Biscuit Company takes over biscuit distribution from Parry's during
the year 1975. In 1976, the company had introduced Britannia bread in
Calcutta and Chennai. During the year 1978, the company made Public
issue, in that Indian shareholding crossed 60%. The Company re-christened
from Britannia Biscuit Company Limited to Britannia Industries Limited with
effect from 3rd October of the year 1979. The Company had signed a 10-year
technical collaboration agreement with Nebico Pvt Ltd., Nepal during the
year 1980 for the supply of know-how relating to manufacturing, packaging
and marketing of biscuits and selection of plant and machinery.
During the year 1989, BIL's Executive Office was relocated to Bangalore.
During the year 1990, two new brands of biscuits, Elaichi Creamand and Petit
Beurre were launched. Also, in the same year a new cashew badam variant
of the brand Milk Bikis and brand extension of pure magic biscuit Vanilla
cream were launched, Fruit bread was launched in Delhi. The Company
launched two new speciality brands in the year 1991 viz., Britannia milk
bread and Britannia brown bread in Delhi and extended nationally its main
brands Petit Beurre and Elaichi Cream.
In 17th August of the year 1991, the Company handed over its Soya unit at
Vidisha, MP to SM Dychem Ltd. BIL had celebrated its Platinum Jubilee in the
year 1992. After a year in 1993, Wadia Group had acquired the stake in ABIL,
UK and becomes an equal partner with Group Danone in BIL. The Company
was in re birth phase during the year 1997, new corporate identity 'Eat
Healthy, Think Better' leads to new mission of 'Make every third Indian a
Britannia consumer' and in the same year BIL entered into the dairy products
market.
In the same year, the company had launched Britannia Milkman Butter, a
product under the Milkman brand. BIL made its fund in-principle agreement
to acquire 49 per cent of Kwality Biscuits in the year 2001 through internal
accruals. During the year 2002, the company had 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 and
the Britannia New Zealand Foods Pvt. Ltd was born. Pure Magic, the
company's product was winner of the Worldstar, Asiastar and Indiastar award
for packaging in the same year 2002.

After a year, in 2003, BIL had launched 'Treat Duet', most successful of the
year and Britannia Khao World Cup Jao rocks the consumer lives yet again.
During the year 2004, Britannia accorded the status of being a 'Superbrand'
and the brand Good Day added a new variant Choconut in its range.
Reviewed marketing alliance with the Kolkata-based Thacker Dairy Products
Pvt Ltd.
In the year 2005, Britannia New Zealand had launched health drink for
adult. The new plant in Uttaranchal, commissioned during the year 2005, it
was ahead of schedule. In the same year, launched yet another exciting
snacking option the Britannia 50-50 Pepper Chakkar. BIL had forged a
strategic alliance with CCD Daily Bread Pvt Ltd in the year 2006, a Bangalore
based Company engaged in manufacturing and retailing of premium breads,
cakes snacks and high end ready to eat foods.

Overview
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 exacting
standards of English tea-time snacking. From the paeans of ecstasy for that
first batch of aromatic, flavour-some biscuits was born a long tradition of
delectable baking - and its Indian custodian, Britannia.
Over the last century and a quarter, Britannia has been serving the Indian
consumer with a range of fresh, nutritious and flavour-rich products. We take
pride in our food making traditions and in our innovations, in equal measure.
We demand the best of ingredients and package their natural goodness in
our products, without compromise. We deliver a complete sensory
experience, in every product, every time.
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. Our core emphasis
across portfolios is on healthy, fresh and delicious food and we are the First
Zero Trans-fat Company in India. 50% of our product portfolio is enriched
with micro-nutrients. Our products are also delivered through the Britannia
Nutrition Foundation to combat malnutrition among underprivileged children.
Britannia Dairy had its beginnings in 1997. Britannia was one of the first
companies in India to pioneer category defining innovations like Cream
Cheese and introducing a host of international flavors for its cubes & spreads
in India. Today Britannia Dairy products contribute close to 10% of the
companys revenue. Britannia markets its dairy portfolio on the back of a
well integrated cold chain logistics network and reaches 3 million outlets
across the length & breadth of this country.
Our relentless focus on quality and freshness has won us prestigious
accolades including the Golden Peacock National Quality Award and the

Ramakrishna Bajaj National Quality Award. However, the award that we

cherish the most is the one given by our consumers.
PRODUCTS

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

100% WHOLE WHEAT BREAD

MULTI-GRAIN BREAD
HONEY OATS BREAD
MULTI FIBER BREAD
BROWN BREAD
VITAMIN ENRICHED BREAD
HEALTHY SLICE BREAD
FRUIT BREAD
FRUIT BUN
BURGER BUN
PAV
DAIRY

CHEESE
FRESH DAIRY
ACCOMPANIMENTS
CAKES

BAR CAKES
CHUNK CAKE
NUT & RAISIN ROMANCE
MUFFILLS
RUSK

PREMIUM BAKE

MASKA RUSK

Growth and profitability

Between 1998 and 2001, the company's sales grew at a compound annual
rate of 16% against the market, and operating profits reached 18% More
recently, the company has been growing at 27% a year, compared to the
industry's growth rate of 20%. At present, 90% of Britannias annual revenue
of Rs22 billion comes from biscuits.

Britannia is one of India's 100 Most Trusted brands listed in The Brand
Trust Report.

BRANCHES
1.
2.
3.
4.

Kolkata
Mumbai
Chennai
Utharakand

VISION
To determine the food and beverage market in india with a distinctive
ranged tasty but healthy
MISSION
We believe in quality and service every third customer must be a
britania customer
The colour of red , green and white represents as
Red - symbolizing energy and vitality
Green - nutrition and freshness
White - purity

Leadership
Britannians exhibit the following leadership behaviors (we fondly call BULBs
Britannia Universal Leadership Behaviors)
:
Integrity
Team Orientation
People Development

 Learning Orientation
Customer Orientation
Quality Orientation
Drive for Results
Entrepreneurial Spirit
System and Process Orientation
Communication

Oppurtunities
Summer Internships at Britannia last for about 8 weeks. Interns are selected
from the best B Schools around the country and are given the opportunity to
work on Live Projects in our different functions. At the end of the internship,
project plans and recommendations are made to the companys
Management Committee and the best Summer Interns are offered a PrePlacement Interview or a Pre-placement Offer. There is also a Best Summer
Project award that is given to one deserving intern, along with a sizeable
cash award.
Britannia gives you a great learning experience in varied roles enabling
adaptability in an ever changing business environment. Our work culture
can
be
characterized
by
strong
performed.
However Britannia is incomplete without an essential ingredientFUN!!!
Every new joinee finds a friend and a mentor in every Britannian he or she
encounters during his/her tenure in this organization. The Family like culture
of this 100 year young organization fuels the life-blood of every Britannian
and has helped strengthened bonds manifold across almost a century.

Core values
It's not hard to make decisions when you know what your values are.
Those words capture, in a nutshell, what we believe in. Our foundation is
built on the core values that we stand by and demonstrate through our
actions every single day.

Careers
Not many companies can boast a 100-year distinguished history, and fewer

still can be linked with stakeholders and markets across continents. This
superlative trajectory notwithstanding, at Britannia it's always been
recognized that none of it would have been possible without the people.
Over the years, Britannia has been associated with many brilliant careers,
and evidence of the success of its strategic-yet-friendly people policies is to
be seen in the current crop of management and staff and indeed the
performance of the company.Today, with the extraordinarily dynamic and
adaptive people we attract, Britannia is fully geared for the new-age
business paradigm. If you feel you are in sync with the Britannia vision, do
call us to explore opportunities in your sphere of work.

Strengths
Widely accepted in all Generations
Provide good Instant Remedy for hunger in the form of readymade food
Preserves the non seasonal food and makes it available all throughout the
year
There is no labour union in this organization
Using manpower on large scale
Company has much experienced, qualified and competent employees in
each department.

WEAKNESSES
Increases the cost of food product.
Industry and technology requires high investment.
Company is using manpower on large scale so, expenses are high.
No separate colony for employees so, they have to travel a lot on daily
basis.

Marketing Strategies
A strong quality of the product and customer satisfaction.
A growing relationship with customer and customer retention.
Focus on competitors activity.
A growing emphasis on global thinking and local marketing planning

 OBJECTIVE
Short Term Long Term
To improve image to
To be the lowest-cost shareholders producer in the market
To improve internal
To become largest processes and controls volume player in the bakery
industry

Goal
To improve profitability
To provide better customer service
To reduce carbon emissions

AWARDS AND AXHIEVEMENTS

1. Bronze award winner for Best Brand Campaign (Britannia Tiger) at
Times of India, Big Bang Awards 2013
2. The Platinum Award (Packaged Foods category) in the Reader's Digest
Trusted Brand Awards 2014
3. Britannia features in the Top 10 of the ET Brand Equity - India's Most
Trusted Brands/Most Trusted Food Brands consistently since 2003
4. The Most Attractive Brand 2013 (F & B- Diversified Category) in the
TRA- Indias Most Attractive Brands Survey 2013

5. Ltd was awarded the Global Performance Excellence Award by Asia

Pacific Quality Organization in Chicago on June 18. It won the "Best In
Class" award, an international recognition for its manufacturing units
and the overall processes of performance excellence adopted by the
company.

6. The John Schlesinger Britannia Award for Excellence in Directing is

awarded to a director whose work is distinguished by ingenuity. Past
recipients have included Anthony Minghella, Christopher Nolan,
Quentin Tarantino, Danny Boyle, Jim Sheridan, David Yates and Peter
Weir.
7. The Albert R. Brocolli Britannia Award for Worldwide Contribution to
Filmed Entertainment is reserved for the few extraordinary luminaries
whose careers have had a truly global impact including Dame Elizabeth
Taylor, Kirk Douglas, John Lasseter and Sidney Poitier. In 2012, video
games pioneer Will Wright became the first ever Britannia Award
recipient from the world of Games.
8. In 2006, the Britannia Award for British Artist of the Year was added to
honor outstanding contemporary British talent such as Kate Winslett,
Emily Blunt, Rachel Weisz, Tilda Swinton, Michael Sheen, Helena
Bonham Carter, Daniel Craig and Benedict Cumberbatch.
9.

The Britannia Humanitarian Award was created to honor those who

have used the moving image to promote charitable causes such as
Don Cheadle for his dedication to Rwanda and Darfur and to Richard
Curtis who co-created Comic Relief and led the efforts of Idol Gives
Back.

10.
Most recently, the award was presented to Idris Elba for his work
with The Prince's Trust.
11.
Through a special arrangement with the Chaplin family, in 2010
BAFTA Los Angeles introduced the Charlie Chaplin Britannia Award for
Excellence in Comedy with Betty White honored for her career
spanning over 60 years.
12.
In 2011 the award was presented to Ben Stiller and in 2012,
South Park team Matt Stone and Trey Parker were honored. In 2013
13.
The award was presented to Sacha Baron Cohen, who's
acceptance speech broke many online viewing records.
14.
Vinita Bali, Managing Director of Britannia Industries, accepted
the award on behalf of the company and said I am delighted to
receive this award.
15.
In Britannia we are focusing on children and malnutrition
because we believe that a healthy child will go on to become a
responsible and fit adult.

16.
In order that the award serves as a catalyst for a lasting service
initiative, the Club launched the Rotary Club of Madras-Britannia
Nutrition Initiative on the occation.

Milestones of the Company

1892- The Genesis Britannia
1921- Imported machinery introduced
1975- Britannia Biscuit Company takes over biscuit distribution from
Parrys
1997- Re-birth - new corporate identity Eat Healthy, Think Better
2001- No.1 food brand of the country
2003- Treat Duet
2005- Re-birth of Tiger
2009- Britannia Launches Active Mind. Eat Healthy, Think Better to Drink
Healthy, Think Better as well!!

RATIO ANALYSIS OF BRITANNIA COMPANY

Liquidity ratios
Current ratio:
Def:
Current ratio means it measures the ability of a firm to meet its short
term obligations. The current ratio is calculated by dividing current assets
by current liabilities. A relatively high current ratio compared with those of
other firms in the same business and although it may tend to result in
reduced profitability.

Formula:
Current ratio

current assets/current

liabilities

YEARS

CURRENT
ASSETS

CURRENT
LIABILITIES

CURRENT
RATIO

2014

486.33

660.98

0.87

2013

473.09

576.90

0.82

2012

465.36

882.53

0.52

2011

395.72

406.63

0.97

2010

325.94

345.04

0.94

INTERPRETATION:
In these company ratios, the liquidity position of the company is not
good in all the years. According to this ratio standard is 2:1.

QUICK RATIO:
Def:

Quick ratio is also known as Acid Test Ratio. It shows the ratio of cash and
other liquid resources of an organisation in comparison of its current
liabilities.
Quick ratio shows the extent of cash and other current assets that are
readily convertible into cash in comparison to short term obligations.

Formula:
Quick ratio = quick assets / current liabilities

Years

Quick assets

Current
liabilities

Quick ratio

2014

119.47

660.98

0.18

2013

141.6

576.90

0.24

2012

89.08

882.53

0.09

2011

84.52

406.63

0.20

2010

57.6

345.04

0.16

INTERPRETATION:

In these company ratios, the liquidity position of the company is

not good in all the years. According to this ratio standard is 1:1.

DEBT EQUITY RATIO:

Def:
Debt equity ratio is equal to long term debt divided by common share
holders equity. It is a measure of the relative contribution of the creditors
and shareholders or owners in the capital employed in business. It indicates
what proportion of equity and debt the company is using to finance its
assets.

Formula:
Debt equity ratio =

debt/equity

years

debt

equity

Debt
ratio

2014

462

853.46

0.54

2013

194.47

638.70

0.30

2012

28.15

520.04

0.05

2011

431.44

451.30

0.95

2010

429.61

396.25

1.08

equity

INTERPRETATION:

In these company ratios, the liquidity position of the

company is not good in all the years. According to this ratio standard is
2:1.

PROPRIETORY RATIO:
DEFINITION:
Proprietary ratio is also known also Equity ratio or net worth to
total assets or shareholder equity to total equity. It establishes the
relationship between proprietors funds to total resources of the unit.
Where proprietors fund refers to equity share capital and reserves,
surplus and total resources refers to total assets.
Formula:

Proprietary ratio =

Net worth / total assets

years

Net worth

Total assets

Proprietary
ratio

2014

853.43

858.46

1.00

2013

638.70

853.17

0.74

2012

520.04

848.19

0.61

2011

454.30

882.76

0.51

2010

396.25

825.87

0.47

INTERPRETATION:

In these company ratios, the ratio is good in the year of

2014 compare to remaining 4 years. So, the position of the company is
good.

RETURN ON CAPITAL EMPLOYED:

Def:
The ratio of EBIT to shareholders equity plus long term liabilities,
expressed as a percentage. A measure of how well a company uses all its
sources of long term financing to generate a profit (before tax and
interest). And also called as return on investment

Formula:
Return on capital employed = net operating
profit/capital employed * 100
Years

Net operating Capital

profit
employed

Return
capital
employed

2014

548.06

853.46

64.20

2013

369.92

638.70

50.00

2012

2904.44

52.04

50.00

2011

233.54

451.30

51.70

2010

122.33

396.25

30.80

on

INTERPRETATION:

In this company the profitability ratio is very good

in the year of 2014 compare to the remaining 4 years. And it is go on
increasing, so the position of the company is very good.

TOTAL ASSETS TURNOVER RATIO:

Def:
Assets turnover ratio is a financial ratio that measures the efficiency
of a companys use of its assets in generating sales revenue or sales
income to the company.
Companies with low profit margins tend to have high asset turnover,
while those with high profit margins have low asset turnover. Companies
in the retail industry tend to have a very high turnover ratio due mainly to
cutthroat and competitive pricing.

Formula:
Asset turnover ratio=
total assets

Net sales revenue / Average

Years

Net
sales Average total Asset
revenue
assets
turnover
ratio

2014

6307.39

858.08

7.35

2013

5615.49

833.17

6.58

2012

4974.19

848.19

5.86

2011

4217.59

882.76

4.77

2010

3404.70

825.87

4.12

INTERPRETATION:

In this company the ratio is very good in the year of 2014 compare to
remaining 4 years. And there is a better improvement in the company .so,
the position of a company is very good.

PARLE COMPANY
HISTORY
Parle Products company was founded in 1929 in British India. It was owned
by the Chauhan family of Vile Parle, Mumbai. Parle began manufacturing
biscuits in 1939. In 1947, when India became independent, the company
launched an ad campaign, showcasing its Gluco biscuits as an Indian
alternative to the British biscuits. The Parle brand became well known in
India following the success of products such as the Parle-G biscuits and
the Thums Up soft drink.
The original Parle company was split into three separate companies, owned
by the different factions of the original Chauhan family.

Parle Products, led by Vijay, Sharad and Raj Chauhan (owner of the
brands Parle-G, Melody, Mango Bite, Poppins, Kismi toffee bar, Monaco
and KrackJack).

Parle Agro, led by Prakash Chauhan and his daughters Schauna, Alisha
and Nadia (owner of the brands such as Frooti and Appy)

Parle Bisleri, led by Ramesh Chauhan

Since 1929, Parle Products, with its wide platter of biscuits and sweets
is also actively engaged in changing and uplifting the social face of India.
As part of its Corporate Social Responsibility Policy, Parle is keenly
involved in the overall development of the younger generation, with a
focused endeavor to build the New Face of India and spread happiness
and joy all over.

All three companies continue to use the family trademark name "Parle". The
original Parle group was amicably segregated into three non-competing
businesses. But a dispute over the use of "Parle" brand arose, when Parle
Agro diversified into the confectionary business, thus becoming a competitor
to Parle Products. In February 2008, Parle Products sued Parle Agro for using
the brand Parle for competing confectionary products. Later, Parle Agro
launched its confectionery products under a new design which did not
include the Parle brand name.[4] In 2009, the Bombay High Court ruled that

Parle Agro can sell its confectionery brands under the brand name "Parle" or
"Parle Confi" on condition that it clearly specifies that its products belong to a
separate company, which has no relationship with Parle Products.
Primarily eaten as a tea-time snack, Parle-G is one of the oldest brand names
in India. For decades, the product was instantly recognized by its iconic white
and yellow wax paper wrapper. The wrapper features a young girl (an
illustration by Everest creative Maganlal Daiya back in the 1960s).
Now, it is available in plastic wrapping. Design of packaging is the same as
earlier. When the company changed the packaging of Parle-G from wax
paper to plastic, they made an ad of putting Parle-G in fish tank.
As of January 2013, Parle-G's strong distribution network covered over 6
million retail stores in India. The Brand Trust Report ranked Parle-G as the
42nd most trusted brand of India in 2014.
The low price is another important factor in Parle-G's popularity. Outside
India, it is sold for 99 cents for a 418 gram pack as of 2012. A more common
80 gram "snack pack" is sold for as low as 15 cents at Indian grocers, and 40
cents at major retailers.

Available Anywhere
Today, the great strength of Parle Products is the extremely widespread
distribution network. Even at the remotest places, you can buy Parle biscuits
and sweets from the local grocer. It has taken years to create this extensive
network. Parles sales force started with one salesman in Bombay and some
agents in few other cities. Gradually, Parle Products expanded. Soon sweets
and biscuits were being sent by rail to Calcutta, Delhi, Karachi, Madras and
other major cities. As production increased, distribution was amplified. Full
time salesmen were appointed in different areas. Currently, Parle Products
has over 33, 00,000 distribution outlets.

Green planet
Imagine a world that's clean and fresh as the way we inherited it. Imagine a
world full of trees, birds and animals. The fact that we have to imagine it,
speaks volumes about the state of our planet.
The world is a home not just to human beings but also to a wide variety of
animals and plants. All of them are dependent on each other for survival.
When we take these natural resources for granted or disturb the natural
harmony of things, we face consequences like global warming.

Parle's products have been trusted by mothers and children across age
groups as a nutritious snack that has helped them grow healthy and strong.
It is but natural that Parle Products would like to return the favour to a
generation that has helped it grow. Parle Products feels this is the best gift
that we can give our kids. A cleaner, greener planet that they can treasure
for generations to come.
My Green Planet is an initiative that takes definitive steps towards
conserving our eco-system. Parle Products is contributing in its own way by
taking up various initiatives like planting more trees around India, conserving
water, power and recycling waste. My Green Planet works across levels
from school students to environmentalists to media professionals and
through them educate and empower everyone about the cause of
environment conservation.

We believe that we haven't inherited the earth, but merely borrowed it from
our children.
The Distribution Channel Network: Parley
The Parley G Distribution Network Intensive Distribution Parley uses Intensive
Distribution for Parley G. This is the ideal strategy for the market leader as
intensive distribution has the following
increases product. Increases
coverage and sale.
Advantages: Encourages retailers to compete aggressive. Higher availability
competition leads to narrower margins for the retails hence, increases the
ultimate margin for the manufacturer. The Channel Members of the
Distribution Network of Parley. The Parley distribution network for biscuits.
Parley Depots has essentially four levels as enlisted below:
Carry Forward Agents (if required), Wholesalers and Distributers Retailers
The Channel Members and Logistics Parley has nearly 1500 wholesalers,
catering to 425000 retail outlets directly or in directly. A two hundred strong
dedicated field force services these wholesalers and retailers. Additionally,
there are 31 depots and Carry and Forward agents supplying goods to the
wide distribution network.
Parley has level 1, level 2, level 3 distribution channels levels.
Level 1: Availability of Parley G biscuits at all departmental stores across the
length and breadth of the country.

Level 2: Since it is an FMCG product this channel exists for customers

scattered throughout the country.
Level 3: Mass consumption and suitable for National and International
coverage. For e.g. Parley international operations consist of serving markets
in the Middle East, Africa, South America, Sri Lanka, Australia and North
America for which the3 level distribution channel exists.
Parley is able to provide products at the Distribution Channel and Parley the
least price in the industry, and is able to give least channel margins as the
channel members earn through volumes and not through. The company has
been able to push its new products into high margins. The market by hooking
them onto the fast moving products like Parley, because of the strong
relationship that Parley shares with butter bite. The constituent channel
members, it forces the channel members to carry all its new products.

Quality
Hygiene is the precursor to every process at Parle. From husking the wheat
and melting the sugar to delivering the final products to supermarkets and
store shelves nationwide, care is taken at every step to ensure the best
product of long-lasting freshness. Every batch of biscuits, confectioneries &
snacks are thoroughly checked by expert staff, using the most modern
equipment. This ensures consistent and perfect quality across the nation and
abroad.
Concentrating on consumer tastes and preferences, the Parle brand has
grown from strength to strength ever since its inception. The factories at
Bahadurgarh, Haryana and Neemrana, Rajasthan are the largest biscuit and
confectionery plants in the country. The factory in Mumbai was the first to be
set up, followed soon by the one in Bangalore, Karnataka. Parley also has 10
manufacturing units for biscuits and 75 manufacturing units for
confectioneries on contract.

Core values
An in-depth understanding of the Indian consumer psyche has helped Parley
develop a marketing philosophy that reflects the needs of the Indian masses.
With products created bearing in mind both health and taste, Parle products
equally appeal to fun loving kids & youth. Even today, the great tradition of
taste and nutrition is consistent in every pack on the store shelves. The
value-for-money positioning allows people from all classes and age groups to
enjoy Parle products to the fullest.

BRANDS
Palettes, there' something for everyone. And the tantalizing array of
sweetmeats is just the cherry on top. Know a little more about all the
delicious Parley products. From yummy biscuits to lip-smacking sweetmeats,
the Parley product range is a genuine treat for every snack lover. The biscuits
alone have such variety, catering to diverse

parley G
Monaco
20_20 cookies
Hide and seek
Nimkin
Happy happy
Gold star
Milano
Cream biscuits
Krack jack
Parley g gold

Snacks

Parleys wafers
Full toss
Nankeen

SOCIAL RESPONSIBILITY
Parley Products with its wide platter of offering of biscuits and sweets
like Parley-G, Krackjack, Monaco, Melody, Mango bite and many others
since 1929 is also actively engaged to change & uplift the social face of
India. As a part of Corporate Social Responsibility Policy Parley is
keenly involved in the overall development of younger generation with
focused endeavour to built New Face of India and spread happiness &
joy all over.

PRICING STRATEGY
Market Penetration strategy with low price.
Value for money positioning
Appeals to all income groups
Profit margin for distributors is 4% and for retailers is 10-12%

STRENGHTS

 Low Price
Sizable market share
Variety of products
Deep & Effective Coverage
Largest distribution system
Better Understanding of consumer psyche

WEAKNESS
Depends on Parley G
Lacking schemes
Replacement of Damaged stock
Improper & irregular supply
Packing of Biscuits

THREATS
Hike in cost of production
Competition from MNCs
Emerging substitutes like toast, wafers.
Entry of various new entrant, ITC etc

OPPORTUNITIES
Demand for innovative packing
Improving supply for brands
Information through television
Retaining loyal retailers

VISION
The main vision of Parley-G to concentrate on consumer tastes and
preferences, the Parle brand has grown from strength to strength ever since
its inception. For fulfilling its vision they do every batch of biscuits and

confectioneries are thoroughly checked by expert staff, using the most

modern equipment hence ensuring the same perfect quality across the
nation and abroad.

Mission
For over 65 years, Parle G has been a part of the lives of every Indian. From
the snow capped mountains in the north to the sultry towns in the south,
from frenetic cities to laid back villages, Parley G has nourished strengthened
and delighted millions. Various people have various reasons to consume it,
some consume it for the value it offers while others consume it for sheer
taste, for some it is a meal substitute for others it is a tasty healthy
nourishing snack. Patronised by millions for all this qualities, it is much more
than just a biscuit brand. Little wonder than why is it the Largest selling
Biscuit brand in the World.
It is to produce and provide quality & innovative healthcare relief for people,
maintain stringently ethical standard in business operation also ensuring
benefit to the shareholders, stakeholders and the society

BUSINESS STRATEGIES
An in-depth understanding of the in mind, Parley appeals to both health
conscious mothers and fun loving kids. The great tradition of taste and
nutrition is consistent in every pack on the store shelves, even today. The
value-for-money positioning allows people from all classes and age groups to
enjoy Parley products to the fullest. Indian consumer psyche has helped
Parley evolve a marketing philosophy that reflects the needs of the Indian
masses. With products designed keeping both health and taste.

Milestones - The Decades of Progress

1929:
The first year of operation. Our only assets were hard work and hope.

1939:
Ten years of determined effort brought results. Things began to take shape.
And we tried even harder.

1949:

The formative years were over. We had come of age.

1974:
Here was the first evidence of Parley as it is today.

Awards
It has been extremely delighted that we have been Ranked 7th in the Brand
Equity's Most Trusted Brand 2012.
Being ranked 7th amongst the top ten most trusted brands by Economic
Times is definitely an honor.
And we are grateful to consumers for trusting us with our products and
quality and we shall continue to deliver best value to our consumers.
Parle products have been shining with the golds and silvers consistently at
the Monde Selection ever since they were first entered in 1971.
Mondi Selection is an international institute for assessing the quality of foods
and is currently the oldest and most representative organization in the field
of selecting quality foods worldwide.

ACHIEVEMENTS
Amongst the top best brands
Winning awards at Mondi selection. Since 1971
111 gold, 26 silver and 4 bronze
Parley G as the proudest product
Gaining popularity in international market
Worlds largest selling biscuit.

RATIO ANALYSIS OF PARLE COMPANY

Liquidity ratios
Current ratio
Current ratio means it measures the ability of a firm to meet its short
term obligations. The current ratio is calculated by dividing current assets
by current liabilities. A relatively high current ratio compared with those of
other firms in the same business and although it may tend to result in
reduced profitability.

Formula:
Current ratio
liabilities

current assets/current

YEARS

CURRENT
ASSETS

CURRENT
LIABILITIES

CURRENT
RATIO

2014

12814.27

6921.52

1.85

2013

11378.54

6404.43

1.77

2012

9442.78

5684.35

1.66

2011

8397.51

5285.75

1.58

2010

5528.03

4619.54

1.19

INTERPRETATION:
In these company ratios, the liquidity position of the company is not good in
all the years. According to this ratio standard is 2:1. So, the company
position is not good.

QUICK RATIO
Quick ratio is also known as Acid Test Ratio. It shows the ratio of cash and
other liquid resources of an organisation in comparison of its current
liabilities.
Quick ratio shows the extent of cash and other current assets that are
readily convertible into cash in comparison to short term obligations.

Formula:
Quick ratio = Quick assets / current liabilities

Years

Quick Current
assets
liabilities

Quick ratio

2014

5454.73

6921.52

0.78

2013

4019.00

6404.43

0.62

2012

2083.24

5684.35

0.36

2011

1037.97

5285.75

0.19

2010

----------

------------

------------

INTERPRETATION:

In these company ratios, the liquidity position of the

company is not good in all the years. According to this ratio standard is
1:1.

DEBT EQUITY RATIO:

Debt equity ratio is equal to long term debt divided by common
share holders equity. It is a measure of the relative contribution of the
creditors and shareholders or owners in the capital employed in business.
It indicates what proportion of equity and debt the company is using to
finance its assets.

Formula:
Debt equity ratio =

Years

debt

debt/equity

equity

Debt

equity

ratio
2014

51.14

26209.61

0.00

2013

66.40

22235.10

0.00

2012

79.09

18738.84

0.00

2011

88.52

15899.93

0.01

2010

107.71

14009.99

0.01

INTERPRETATION:

In these company ratios, the liquidity position of the

company is not good in all the years. According to this ratio standard is
2:1.

PROPRIETORY RATIO:
DEFINITION:
Proprietary ratio is also known also Equity ratio or net worth to
total assets or shareholder equity to total equity. It establishes the
relationship between proprietors funds to total resources of the unit.
Where proprietors fund refers to equity share capital and reserves,
surplus and total resources refers to total assets.
Formula:
Proprietary ratio =

Net worth / total assets

Years

Net worth

Total assets

Proprietary
ratio

2014

26209.61

26260.75

1.00

2013

22235.10

22301.50

1.00

2012

18738.84

18817.93

1.00

2011

15899.93

15988.45

1.00

2010

14009.99

14117.70

1.00

INTERPRETATION:

In these company ratios, the liquidity position of the

company is not good in all the years. Among all the years the company is
having the same ratios.

RETURN ON CAPITAL EMPLOYED:

Def:
The ratio of EBIT to shareholders equity plus long term liabilities,
expressed as a percentage. A measure of how well a company uses all its
sources of long term financing to generate a profit (before tax and
interest). And also called as return on investment

Formula:

Return on capital employed = net operating

profit/capital employed * 100
Years

Net operating Capital

profit
employed

Return
capital
employed

2014

12662.06

26209.61

48.310

2013

10830.65

22235.10

48.709

2012

8975.45

18738.84

47.8975

2011

7336.54

15899.93

46.1419

2010

6068.66

14009.99

43.3166

on

INTERPRETATION:

In this company the profitability ratio is very good in the

year of 2014 compare to the remaining 4 years. And it is go on increasing, so
the position of the company is very good.

TOTAL ASSETS TURNOVER RATIO:

Def:
Assets turnover ratio is a financial ratio that measures the efficiency
of a companys use of its assets in generating sales revenue or sales
income to the company.

Companies with low profit margins tend to have high asset turnover,
while those with high profit margins have low asset turnover. Companies
in the retail industry tend to have a very high turnover ratio due mainly to
cutthroat and competitive pricing.

Formula:
Asset turnover ratio=
total assets

Net sales revenue / Average

Years

Net
sales Average total Asset
revenue
assets
turnover
ratio

2014

332378.60

26260.75

1.26

2013

29901.27

22301.50

1.34

2012

25173.82

18817.93

1.33

2011

21458.98

15988.45

1.34

2010

18567.45

14117.70

1.35

INTERPRETATION:

In this company, the ratios of all the years are being same.
So, the position of the company is not good.

COMPARISION OF BRITANNIA AND PARLE COMPANIES

1.

CR =

CA / CL

YEARS

BRITANNIA

PARLE

2010

0.94

1.19

2011

0.97

1.58

2012

0.52

1.66

2013

0.82

1.77

2014

0.87

1.85

2
1.8
1.6
1.4
1.2
britannia

Column1

0.8
0.6
0.4
0.2
0
2010

2011

2012

2013

2014

INTERPRETATION:

By comparing two ratio, company 2 is increasing every year.

Therefore we can prefer parle company.

2. QR=

QA / CL

YEARS

BRITANNIA

PARLE

2010

0.16

2011

0.20

0.19

2012

0.09

0.36

2013

0.24

0.62

2014

0.18

0.78

0.9
0.8
0.7
0.6
0.5

britannia

0.4

Column1

0.3
0.2
0.1
0
2010

2011

2012

2013

2014

INTERPRETATION:
By comparing two ratio, company 2 is increasing every year.
Therefore we can prefer parle company.

3. DEBT EQUITY RATIO= DEBT / EQUITY

YEARS

BRITANNIA

PARLE

2010

1.08

0.01

2011

0.95

0.01

2012

0.05

0.00

2013

0.30

0.00

2014

0.54

0.00

1.2
1
0.8
britannia

0.6

Column1
0.4
0.2
0
2010

2011

2012

2013

2014

INTERPRETATION:

By comparing two ratio, company 1 is increasing every year.

Therefore we can prefer Britannia company.

4. PR=

Net worth/total assets

YEARS

BRITANNIA

PARLE

2010

0.47

1.00

2011

0.51

1.00

2012

0.61

1.00

2013

0.74

1.00

2014

1.00

1.00

1.2
1
0.8
britannia

0.6

Column1
0.4
0.2
0
2010

2011

2012

2013

2014

INTERPRETATION:
By comparing the two companies ratio, the company 1
is increasing every year and company 2 is having the same ratio.so, both the
companies are in a good position.

5.Return
on
capital
employed
profit/capital employed*100

net

YEARS

BRITANNIA

PARLE

2010

30.80

43.31

2011

51.70

46.14

2012

50.00

47.89

2013

50.00

48.70

2014

64.20

48.31

operating

70
60
50
40
britannia
Column1

30
20
10
0
2010

2011

2012

2013

2014

INTERPRETATION:
By comparing two ratio, company 1 is increasing every year.
Therefore we can prefer Britannia company.

6.
Asset turnover ratio=
total assets

Net sales revenue / Average

YEARS

BRITANNIA

PARLE

2010

4.12

1.35

2011

4.77

1.34

2012

5.86

1.33

2013

6.58

1.34

2014

7.35

1.26

8
7
6
5
britannia

Column1
3
2
1
0
2010

2011

2012

2013

2014

INTERPRETATION:
By comparing two ratio, company 1
Therefore we can prefer Britannia company.

is increasing every year.