Having said above i think in its desperation to disrupt the biscuit segment, amul has done a huge mistake by doing anti marketing. It can back fire badly not just on them but everybody in medium term. Going into ingredients were exactly what consumers were not doing, making them do that can be a twin side blade and mind you consumers remember anti marketing and are very tit for tat and don’t spare the one who does it also. This can be the Ayurveda moment for biscuits, although brands like nutrichoice were already addressing such concerns partly and ahead in the game. All said and done, my respect for amul brand has somewhat diminished after this antimarketing stunt. For a brand as big and great as amul, there were better ways to enter biscuits or any new category as a long term haul. Disappointed!
As someone who loves good day butter cookies, i really dont care what % of butter goes into making of that cookie.
what i care is that taste and flavour.
Ofcourse taste and flavour is subjective.
on the other hand, i havent tried Amul’s cookies yet so cant comment on it.
but, it seems a vain fight to point out what % of butter and what calories and what fat make a cookie.
the people who know about these statistics dont eat cookies and the people who dont know about it splurge on it.
(go to dmart and see how many shopping carts have good day or parle g in them, u will get a idea)
The country’s largest biscuit-maker, Britannia Industries, is looking to beat slowdown blues through a mix of cost optimisation, “judicious” price hikes and low unit packs (LUPs).
“There will be judicious price hikes” to the extent that “it does not pinch the consumer”, said Subramanyam.
Perfectly summarized article.
Does anyone know if Britannia has been compliant with this or not? since the deadline was over.
student’s summer inter report however this is old
Management Interaction update by Nirmal Bang
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Value category showing more impact of slowdown than Premium category.
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Optimistic on salty snacks. Aims to launch it pan India after successful test launch in TN.
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Entry of Amul has not changed the competitive scenario materially as it is too small at present to make an impact.
Q1FY20 Conference Call Transcript
https://finance.yahoo.com/news/edited-transcript-britannia-nse-earnings-065015689.html
update
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Hi,
Is anybody aware of corporate governance issues raised as regards the Britannia management, specifically pertaining to loans given to related persons?
Loan given to which related party? Berry confirmed on tv that no advances were given to related concerns…he’s a director in one such entity, can’t remember the name
If you look at the FY 19 Balance Sheet, loans classified as inter-corporate deposits (ICDs) have been given to the following promoter-owned companies:
Bombay Dyeing: Rs 350 crs @ 10% p.a.
Go Air: Rs 335 crs @ 10% p.a.
These loans also appeared in FY 18 and while the tenor on both states that they are for 1 year, they have been renewed. I didn’t find any update in the quarterly results on the movement of the above accounts but I’m betting they’ve been renewed again.
Britannia has a number of associate and subsidiary companies (Indian as well as offshore) which have also been given loans presumably for the biscuits business.
What also struck me was the convoluted holding pattern of Britannia - its a 100% subsidiary of an overseas company which in turn is 51% owned by Bombay Burmah (BBTC), another Indian listed company 65% owned by the promoter family. The interesting thing about BBTC is that its listed at an almost 80% discount to the value of Britannia + Bombay Dyeing: wonder why the promoters would allow this and not hive off the holding to realise the full value of the company.
Wow, ideally I completely avoid companies with convoluted holdings and too many subsidiaries post my bitter experience with Max group. I am not able to understand this promoter stunt. Until a holding company in terms of BBTC was understandable. But an intermediary overseas firm is beyond game.
Also the hiving off u mentioned is already done. Britannia is already hived off and listed, so is Bombay dyeing. So no more value unlocking possible for BBTC. Maximum income for BBTC would be coming from overseas companies dividend. So Britannia first paid DDT, then it’s oveseas subsidiary must have paid dividend tax as per rules of other country nd lastly BBTC paid DDT to finally bring money to promoters. So much hassle is only possible for 2 reasons…either an u wanted legacy which very difficult now to restructure or some huge benefit that we cannot fathom. Anyone having insights or deeper understanding in benefits of such unique holding structure would be great to know. Thanks
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The deposits to Bombay Dyeing and Go Air, I’d treat it conservatively as write offs. Can’t fathom that a high integrity management like Britannia is doing this. Other stuff in the AR seem ok.
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All large corporations hv a web of shareholding pattern for various reasons, so is there a concern?
I’ve read that the promoter is a person with high integrity, refused bribes in the 70s during the famed corporate war.
This may not add value in today’s context, but in any case I thought of putting this as it reflects how companies and governance has evolved over the years. Other than the corporate war with the Ambani’s, Britannia was in news for wrong reasons during the 90’s. Wadias bought in Rajan Pillai, also known as the Biscuit King of India who eventually seized control from Nabisco. Later on Rajan was ousted and met a tragic end while the control came back to the Wadias. All this drama was played out in full public view. Some of the seniors here might have a better perspective on this, but my point here is that one should hold all companies to high standards and not get influenced by its history or legacy.
True, especially in the Indian context I don’t think there’s too high a price you can place on Management integrity these days. If not for the ICDs, I was extremely keen on adding Britannia to my portfolio last month, and BBTC much before that (if not for the web of cross-holdings - I don’t see the wisdom in them, so I feel it’s best left out of one’s portfolio).