MD Rakshit Hargave says bakery major will adopt ‘startup mentality’ and stay open to acquisitions as margins recover
Bakery and packaged foods maker Britannia Industries plans to increase spending to counter growing competition from regional brands and expand its ecommerce footprint, as it seeks to reinforce its position in categories such as biscuits, rusk, cakes, croissants and wafers.
Speaking on an investor call, Managing Director and Chief Executive Officer Rakshit Hargave said the company would adopt a nimble, entrepreneurial approach to compete with smaller players that hold sway in specific local markets. “We are going to be fighting regional competition, we are going to be investing in ecommerce, yes, that will require more funds. We are committed to invest that. We believe that the opportunity for us to drive topline better is definitely there,” said Hargave in an investors’ call.
He underlined that accelerating revenue growth is vital for widening Britannia’s consumer reach across its portfolio, adding that the company would take a “pragmatic view” when balancing aspirations with available capital.
Britannia, which sells brands such as Good Day, Tiger, NutriChoice and MarieGold, does not see regional rivals as national-scale competitors but as agile, enterprising businesses operating in focused pockets.
“So we will have a startup mentality to fight these people. We will make sure that the ambition that we have are more than the resources that we put. And we actually deliver it better. So, we will manage the expectations accordingly,” he said.
On input costs, Hargave said earlier margin pressures caused by inflation and delayed price hikes have eased as commodity prices have moderated.
“Now, with the commodity prices stable, you see that expansion of margins,” he said.
He noted that February and March are key months for wheat pricing, which will determine the cost outlook ahead. For now, wheat prices appear stable. Sugar is also “kind of stable” and is expected to remain relatively steady in the near term. Cocoa prices have declined, while laminate and milk prices are largely steady, though milk costs will need to be monitored going forward.
“Laminate price is also very stable, and milk price is also slightly stable. How milk behaves going ahead in the future is what we have to see,” Hargave added.
In response to a query on growth strategies, he said the company remains open to inorganic expansion to build a more comprehensive portfolio.
“Everything cannot be built from organic. So that door is also open for us,” Hargave said, indicating potential acquisition opportunities.
While sellout and consumption trends have steadied, Hargave acknowledged that regional competition continues to intensify across markets, not just in the eastern region.
“East is a hotbed of competition, but regional competition exists in other clusters also,” he said, adding that addressing such competitive pockets is a strategic priority.
Chief Commercial Officer Vipin Kataria, who also joined the call, said regional brands leverage their strong understanding of local flavours and consumers, and have developed effective product formats.
“To counter them, we are building and increasing our investment in the brand,” Kataria said.
He added that the company’s immediate focus is to swiftly mirror and respond to the flavours and formats being introduced by regional players, particularly in markets where it faces resistance. Britannia’s game right now is to make sure that “we quickly adopt and adapt the manner in which these regional players are developing these flavours and formats and very quickly hit them in certain pockets of the market where we are getting a pushback.”
