CleanupBot II at 19:57, 13 August 2023

2023-08-13T19:57:50Z

New page

{{short description|Indian multinational food and beverage company}}
{{Use Indian English|date=August 2016}}
{{Use dmy dates|date=August 2016}}
{{Infobox company
| name = Britannia Industries Limited
| logo = Britannia_Industries_logo.svg
| type = [[Public Company|Public]]
| traded_as = {{plainlist|
*{{BSE|500825}}
*{{NSE|BRITANNIA}}
*[[NIFTY 50|NSE NIFTY 50 Constituent]]}}
| key_people = {{plainlist|
*[[Nusli Wadia]] ([[Chairman]])
*Varun Berry ([[Managing Director]])}}
| area_served = Worldwide
| ISIN = INE216A01030
| industry = [[Food processing industry|Food processing]]
| products = {{plainlist|
*[[Bakery|Bakery products]] including [[biscuits]], [[bread]], [[cakes]] and [[rusk]]
*[[dairy products]] including [[milk]], [[butter]], [[cheese]], [[ghee]] and [[dahi (curd)|dahi]]}}
| services =
| former_name = Britannia Biscuit Company Limited
| revenue = {{increase}} {{INRConvert|11878.95|c}} (2020)<ref name="Britannia Industries Consolidated Profit & Loss account">{{cite web | url=https://www.moneycontrol.com/stocks/company_info/print_main.php | access-date= 26 December 2020}}</ref>
| operating_income = {{increase}} {{INRConvert|1860.87|c}} (2020)<ref name="Britannia Industries Consolidated Profit & Loss account" />
| net_income = {{increase}} {{INRConvert|1402.63|c}} (2020)<ref name="Britannia Industries Consolidated Profit & Loss account" />
| assets = {{increase}} {{INRConvert|7253.34|c}} (2020)<ref name="Britannia Industries Consolidated Profit & Loss account" />
| owner =
| parent = [[Wadia Group]]
| divisions =
| subsid =
| homepage = {{URL|http://www.britannia.co.in/}}
| footnotes =
| foundation = {{Start date and age|1892}} in [[Calcutta]] {{Start date and age|1918}} as ''Britannia Biscuit Company Limited''
| location_city = [[Kolkata]], [[West Bengal]]
| location_country = [[India]]
| num_employees = 4,480 (as on 31 March 2019)<ref name="BritAnnualReport">{{cite web | url=http://britannia.co.in/pdfs/annual_report/Britannia_Annual_Report_2016-17.pdf | title=Annual Report 2016-17 | publisher=Britannia Industries Limited | date=30 October 2017 | access-date= 30 October 2017}}</ref>
| locations =
| caption =
}}

'''Britannia Industries Limited,''' is an [[India]]n [[multinational corporation|multinational]] [[Food industry|food and beverage]] [[company]]<ref>{{Cite web |title=Company Overview |publisher=Britannia Industries Limited |url=http://britannia.co.in/about-us/overview |access-date=2020-08-16}}</ref> Founded in 1892 and headquartered in [[Kolkata]], [[India]]. It is one of India's oldest existing companies. It is now part of the [[Wadia Group]] headed by [[Nusli Wadia]]. It is best known for its biscuit products. The company sells its ''Britannia'' and ''Tiger'' brands of [[biscuit]]s, [[bread]]s and [[dairy product]]s throughout India and in more than 60 countries across the world.<ref name=brit>[http://britannia.co.in/about-us/overview Company Overview] Britannia Industries</ref> Beginning with the circumstances of its takeover by the Wadia group in the early 1990s, the company has been mired in several controversies connected to its management. However, it does enjoy a large market share and is exceedingly profitable.{{Cn|date=September 2020}}

==History==
The company was established in 1892 by a group of British businessmen with an investment of {{INR}}295.<ref name=brit/> Initially, biscuits were manufactured in a small house in central Kolkata. Later, the enterprise was acquired by the Gupta brothers, mainly Nalin Chandra Gupta, an attorney, and operated under the name "V.S. Brothers." In 1918, C.H. Holmes, an English businessman based in Kolkata, was taken on as a partner and The Britannia Biscuit Company Limited (BBCo) was launched. The Mumbai factory was set up in 1924 and [[Peek Freans]] UK, acquired a controlling interest in BBCo. Biscuits were in high demand during World War II, which gave a boost to the company's sales. The company name was changed to the current "Britannia Industries Limited" in 1979. In 1982, the American company [[Nabisco Brands, Inc.]] acquired the parent of [[Peek Freans]] and became a major foreign shareholder.

==Businesses==
[[File:Britannia Little Hearts.jpg|thumb|right|260px|Britannia Little Hearts]]
The company's principal activity is the manufacture and sale of biscuits, bread, [[rusk]], cakes and [[dairy products]].

===Biscuits===
The company's factories have an annual capacity of 433,000 tonnes.<ref name=scarred/> The brand names of Britannia's biscuits include ''[[Marie biscuit|VitaMarieGold]]'', ''Tiger'', ''Nutrichoice'', ''Good day'', ''50 50'', ''Treat'', ''Pure Magic'', ''Milk Bikis'', ''Bourbon'', ''[[Nice biscuit|Nice]]'' Time and ''Little Hearts'' among others.

In 2006, ''Tiger'', the mass market brand, realised $150.75 million in sales, including exports to the U.S. and Australia. This amounts to 20% of Britannia revenues for that year.

Also Britannia Industries has roped in Bollywood actor Salman Khan to endorse its range of 'Tiger' brand of biscuits. According to Britannia, Khan will play a role in further enhancing Tiger's core values through his association in presenting the brand, its products and promotional activities.

===Dairy products===
Dairy products contribute close to 10% to Britannia's revenue.<ref name=hindu1>Abhrajit Gangopadhyay, [http://www.blonnet.com/bline/2002/01/08/stories/2002010800950500.htm "Danone move may hit Britannia's dairy plans"], ''Hindu Business Line'', 7 January 2002</ref> The company not only markets dairy products to the public but also trades dairy commodities business-to-business. Its dairy portfolio grew to 47% in 2000-01 and by 30% in 2001-02. Its main competitors are [[Nestlé India]], the [[National Dairy Development Board]] (NDDB), and [[Amul]] (GCMMF).<ref name=hindu>Aarati Krishnan, [http://www.blonnet.com/iw/2002/02/03/stories/2002020300110800.htm "Britannia Industries: Pare exposures"], ''Hindu Business Line'', 3 February 2002</ref>

Britannia holds an equity stake in Dynamix Dairy and outsources the bulk of its dairy products from its associate.

On 27 October 2001, Britannia announced a joint venture with [[Fonterra|Fonterra Co-operative Group]] of New Zealand, an integrated dairy company which handles all aspects of the value chain from procurement of milk to making value-added products such as cheese and buttermilk.<ref name=hindu/> Britannia intends to source most of the products from New Zealand, which they would market in India.<ref name=hindu1/> The joint venture will allow technology transfer to Britannia.<ref name=hindu/> Britannia and New Zealand Dairy each hold 49% of the JV, and the remaining 2 percent will be held by a strategic investor. Britannia has also tentatively announced that its dairy business (probably including Dynamix) would be transferred to the joint venture.<ref name=hindu/> However, the authorities' approval to the joint venture obliged the company to start manufacturing facilities of its own. It would not be allowed to trade, except at the wholesale level, thus pitching it in competition with Danone, which had recently established its own dairy business.<ref name=hindu/>

==Performance 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%.{{Citation needed|date=August 2013}} More recently, the company has been growing at 27% a year, compared to the industry's growth rate of 20%.{{Citation needed|date=August 2013}} At present, 90% of Britannia's annual revenue of [[Indian rupee|Rs]] 22 billion comes from biscuits.

Britannia is one of India's 100 Most Trusted brands listed in ''[[The Brand Trust Report]]''.<ref>{{cite web |title=All India Brand Trust Ranking |url=http://www.trustadvisory.info/allindia.html |work=[[The Brand Trust Report]] |publisher=Trust Research Advisory |access-date=27 February 2012 |quote=67: Britannia |url-status=dead |archive-url=https://web.archive.org/web/20120218001005/http://www.trustadvisory.info/allindia.html |archive-date=18 February 2012 |df=dmy }}</ref>
Britannia has an estimated market share of 38%.<ref name=scarred>Ruchita Saxena,[http://www.business-standard.com/common/storypage.php?autono=300420&leftnm=1&subLeft=0&chkFlg= "Battle-scarred Britannia on expansion spree"], ''[[Business Standard]]'', 6 October 2007</ref>

==Disputes and controversies==
===Wadia and Rajan Pillai===
Kerala businessman [[Rajan Pillai]] secured control of the group in the late 1980s, becoming known in India as the 'Biscuit Raja'.<ref>{{cite news |title=Rajan Pillai death: Advani rejects probe plea |publisher=Rediff.com |archive-date=11 November 2013 |url=http://mypage.rediff.com/money/1998/aug/04rajan.htm |access-date=27 February 2012 |archive-url=https://web.archive.org/web/20131111035857/http://mypage.rediff.com/money/1998/aug/04rajan.htm |url-status=dead |df=dmy }}</ref> In 1993, the [[Wadia Group]] acquired a stake in Associated Biscuits International (ABIL), and became an equal partner with [[Groupe Danone]] in Britannia Industries Limited.

In what ''[[The Economic Times]]'' referred to as one of [India's] most dramatic corporate sagas,<ref name=pie>{{cite news |title=Pillai's brother eyes global JV for biscuits pie |url=http://articles.economictimes.indiatimes.com/2007-02-12/news/28384619_1_global-majors-dry-fruit-rajmohan-pillai |work=[[The Economic Times]] |date=12 February 2007 |access-date=7 February 2012 |archive-url=https://web.archive.org/web/20120121130202/http://articles.economictimes.indiatimes.com/2007-02-12/news/28384619_1_global-majors-dry-fruit-rajmohan-pillai |archive-date=21 January 2012 |url-status=dead |df=dmy }}</ref> Pillai ceded control to Wadia and Danone after a bitter boardroom struggle,<ref name=barista>{{cite news |title=Barista to be sold again, for Rs 150-200 cr |url=http://www.articlearchives.com/consumer-products/food-beverage-products-nonalcoholics/1773492-1.html |work=[[The Times of India]] |date=10 October 2006 |access-date=4 March 2009}}</ref> then fled his Singapore base to India in 1995 after accusations of defrauding Britannia, and died the same year in [[Tihar Jail]].<ref name=silicon>{{cite news |title=Beta groups records Rs.20 bn turnover |url=http://www.siliconindia.com/shownews/Beta_groups_records_Rs20_bn_turnover___-nid-19523.html |work=Silicon India |date=19 May 2003 |access-date=4 March 2009 }}</ref>

===Wadia and Danone===
The Wadias' Kalabakan Investments and Group Danone had two equal joint venture companies, Wadia BSN and [[United Kingdom]] registered Associated Biscuits International Holdings Ltd., which together held a 51 percent stake in Britannia.<ref name=standard>Dev Chatterjee, [http://www.business-standard.com/india/news/danone-takes-arbitration-route-to-end-wadia-ties/289603/ "Danone takes arbitration route to end Wadia ties"], ''[[Business Standard]]'', 1 July 2007. Retrieved 27 February 2012.</ref> The ABIH tranche was acquired in 1992, while the controlling stake held by Wadia BSN was acquired in 1995. It was agreed that, in case of a deadlock between the partners, Danone was obliged to buy the Wadia BSN stake at a "[[fair market value]]". ABIH had a separate agreement signed in 1992 and was subject to British law.<ref name=standard/><ref>Kala Vijayraghavan, [http://economictimes.indiatimes.com/articleshow/498004.cms "ABIL joins Britannia-Group Danone battle"], ''[[The Economic Times]]'', 21 November 2006</ref>

Wadia was to be Danone's partner in the food and dairy business, and product launches from Groupe Danone's were expected but never materialised despite the JV being in existence for over 11 years in India.<ref name=standard/> Under the 1995 joint venture agreement, Danone is prohibited from launching food brands within India without the consent of the Wadias.<ref>Ruth David, [https://www.forbes.com/markets/2007/06/25/danone-brittania-wadia-markets-equity-cx_rd_0625markets1.html "Danone's Indian Cookie JV Set To Snap"], ''Forbes'', 25 June 2007</ref> In addition, the partners agreed there would be the right of first refusal to buy out the remaining partner in the event of the other wishing to sell its holding.<ref name=iris>{{cite news |url=http://www.myiris.com/newsCentre/newsPopup.php?fileR=20070621074733126&dir=2007/06/21&secID=livenews |title=Danone may dissolve ties with Britannia |newspaper=Business Standard |publisher=IRIS News Digest |date=21 June 2007 |access-date=27 February 2012 |archive-url=https://web.archive.org/web/20110720001438/http://www.myiris.com/newsCentre/newsPopup.php?fileR=20070621074733126&dir=2007%2F06%2F21&secID=livenews |archive-date=20 July 2011 |url-status=dead |df=dmy-all }}</ref>

In June 2006, Wadia claimed Danone had used the Tiger brand to launch biscuits in Bangalore.<ref name=iris/> In May 2007, Nusli Wadia told the Ministry of Commerce and Industry that Danone invested in a Bangalore-based bio nutrition company, [[Avesthagen]], in October 2006 in violation of the government's Press Note 1, 2005, which requires a foreign company to obtain the consent of its Indian joint venture partner before pursuing an independent business in a similar area, including joint ventures based purely on technical collaboration. Danone argued that Press Note 1 did not apply to it as it did not have a formal technology transfer or trademark agreement with Avesthagen, and that its 25% holding in Britannia was indirect.<ref>[http://www.abcmoney.co.uk/news/25200777303.htm "Danone denies JV with India's Britannia; to proceed with solo plans - report"], ''Thomson Financial'', 25 May 2007</ref> Wadia also filed a case in the Bombay High Court for a breach of a non-competition clause in that connection. The court ordered Danone not to alienate, encumber or sell shares of Avesthagen.<ref>[http://news.moneycontrol.com/mccode/news/article/news_article.php?autono=254762 "Wadias take Danone to court"], 5 December 2006</ref>

In September 2007, the Foreign Investment Promotion Board of India rejected Danone's claims that it did not need a non-compete waiver from the Wadias to enter into business in India alone.<ref>[http://www.domainb.com/companies/companies_b/britannia/20070928_wadia.html "Danone needs NOC from Wadias: FIPB"], 28 September 2007</ref>

After a prolonged legal battle, Danone agreed to sell its 25.48% stake in Britannia to Leila Lands, which is a Wadia group entity based in Mauritius, and quit this line of business. The deal was valued at $175–200 million. With this buy-out, Wadia holds a majority stake of 50.96%.<ref>[http://timesofindia.indiatimes.com/Business/Danone-to-sell-Britannia-stake/articleshow/4367591.cms "Danone to sell Britannia stake"], 7 April 2009</ref>

===Intellectual property dispute===
In a separate dispute from the shareholder matters, the company alleged in 2006 that Danone had violated its intellectual property rights in the Tiger brand by registering and using ''Tiger'' in several countries without its consent. Britannia claimed the company found out that Danone had launched the Tiger brand in Indonesia in 1998, and later in Malaysia, Singapore, Pakistan and Egypt, when it attempted to register the Tiger trademark in some of these countries in 2004.<ref name=forbes1>{{cite news |author=Ruth David |url=https://www.forbes.com/2007/09/20/brittania-danone-legal-markets-equity-cx_rd_0920markets41.html |title=Indian Cookie Maker Taking Danone To Court |work=Forbes |date=20 September 2007| archive-url=https://web.archive.org/web/20071125125430/http://www.forbes.com/markets/2007/09/20/brittania-danone-legal-markets-equity-cx_rd_0920markets41.html |archive-date=25 November 2007 |access-date=27 February 2012}}</ref> Whilst it was initially reported in December 2006 that agreement had been reached,<ref>[http://goliath.ecnext.com/coms2/gi_0198-369415/Danone-to-return-Tiger-to.html "Danone to return 'Tiger' to Britannia"], ''Knight-Ridder Tribune Business News'', 4 December 2006</ref> it was reported in September 2007 that a solution remained elusive.<ref name=forbes1/> In the meantime since Danone's biscuit business has been taken over by [[Kraft Foods|Kraft]], the Tiger brand of biscuits in Malaysia was renamed Kraft Tiger Biscuits in September 2008.

Britannia initiated legal action against Danone in [[Singapore]] in September 2007.<ref>{{cite news|url=http://www.deccanherald.com/Content/Sep212007/business2007092026383.asp |title=Britannia sues Danone in S'pore |newspaper=Deccan Herald |date=21 September 2007 |access-date=27 February 2012 |archive-url= https://web.archive.org/web/20071213062825/http://www.deccanherald.com/Content/Sep212007/business2007092026383.asp |archive-date=13 December 2007 }}</ref> The dispute was resolved in 2009 with [[Britannia]] securing rights to the Tiger brand worldwide, and Danone paying ₹220 million to utilise the brand.<ref>[http://economictimes.indiatimes.com/Markets/Stocks/Stocks-in-News/Britannia-surges-on-Danone-dispute-settlement/articleshow/4957770.cms "Britannia surges on Danone dispute settlement"], ''Economics Times'', 1 September 2009</ref>

==Sponsorship==
* [[Indian Super League]] 2018–present

==See also==

* [[Parle Products]]
* [[Wahaha Joint Venture Company]]

==References==
{{Reflist}}

==External links==
{{commons category|Britannia Industries}}
* {{Official website}}

{{Wadia Group}}
{{Nifty 200 companies}}
{{S&P CNX Nifty companies}}

[[Category:Food and drink companies of India]]
[[Category:Groupe Danone brands]]
[[Category:Companies based in Kolkata]]
[[Category:Companies listed on the National Stock Exchange of India]]
[[Category:Food and drink companies established in 1892]]
[[Category:Indian brands]]
[[Category:Indian companies established in 1892]]
[[Category:NIFTY 50]]
[[Category:Wadia Group]]

Britannia Industries - Revision history

CleanupBot II at 19:57, 13 August 2023