According to Britannia’s executive, “Britannia Industries, FMCG major, has planned a capital expenditure of around ₹700 crore over the next two-and-half years for its new facilities and is bullish on the rural demand during the COVID-19 crisis”.
Its managing director Varun Berry said, ” The rural demand remained stable during the coronavirus outbreak and the company will focus more on its core products. The company is looking at some capex (capital expenditure) of more than ₹700 crore over the next two-and- half years. Britannia plans to set up new manufacturing facilities in UP, Tamil Nadu, Bihar and Odisha”.
He added, ” In the first quarter of the current fiscal, the company’s net profit increased by 118% to ₹542 crore and the turnover was ₹3,420 crore, up by 26.6% over the corresponding period last year. Since the future is uncertain for the next six to nine months, the company will give priority on the core products, and less focus will be on innovation”.
According to him, “the rural demand was not affected by the coronavirus pandemic and it will continue to grow at a higher pace than urban. the COVID-19 crisis will cause permanent changes in consumer behaviour, and home consumption will increase. During the first quarter, the company has been able to unlock efficiencies and prioritised on high gross margin and premium products. The fast-moving consumer goods company had focused on cutting costs by way of reducing working capital as the inventory levels were low.”
In the context of commodity prices, he said, “There was deflation in flour and milk products, while sugar saw a three per cent price rise.”