BRITIANA INDUSTRIES LIMITED

A PROJECT REPORT

Submitted in partial fulfillment of the

Requirement for the award of

BACHELOR DEGREE IN

COMMERCE

Submitted by

ANJALI SHARMA

Exam. Roll no.-17COM015

Redg. No.-BC17-098

Under the Guidance of

SUGYANI RATH

Assistant professor in Commerce

DEPARTMENT OF COMMERCE

GOVERNMENT COLLEGE (AUTONOMOUS), ANGUL, PIN-759143

SESSION:

2017-2020

1
 ACKNOWLEDGEMENT
I would like to express my special thanks of gratitude to my teacher Mrs. Sugyani Rath who gave me
the golden opportunity to do this wonderful project on the topic Britiana industries limited which also
helped me in doing a lot of research and I came to know about so many new things. I am really
thankful to Him/Her.

Secondly I would also like to thank my parents and friends and others who helped me a lot in
finishing this project within the limited time.

I am making this project not only for marks but to also increase my knowledge.

2
 BONAFIDE CERTIFICATE

This is to certify that the project report titled “Britiana industries limited” submitted by Anjali Sharma
(17COM015) in partial fulfillment of the requirements of the Graduate Degree in Commerce for the
academic session 2017-2020 is the original work of the above candidate.

MRS. SUGYANI RATH

Guide

3
 DECLARATION
I ,ANJALI SHARMA ROLL NO-17COM015 REG. NO- BC17-098 final year students of B.COM
of GOVERNMENT COLLEGE(AUTONOMOUS), ANGUL would like to declare that the project
entitled” “, is a bonafide work done by the student in partial fulfillment of Bachelor’s Degree
affiliated to Government college (Autonomous), Angul. The research submitted is my original work
and true to the best of my Knowledge and belief.

Place-Angul Name of the student -:Anjali Sharma

Date- 09-07-2020

4
 CONTENT

Sr. No. PARTICULARS Page No.

INTRODUCTION

1 COMPANY PROFILE 6

2 OBJECTIVE & METHODOLOGY 8

ADOPTED for the STUDY

3 PRIMARY DATA & SECONDARY DATA 8

4 MAJOR PLAYERS & MARKET SHARE 9

5 PRICING & COST SHEET 10

6 MILESTONES ACHIEVED 12

SWOT ANALYSIS
7 19
8 Consumer Behaviour
DATA ANALYSIS & COLLECTION

9 Balance Sheet 23

10 Profit & Loss A/c 25

11 Statement of Cash Flow 27

12 Comparative Balance Sheet 30

13 Comparative Profit & Loss A/c 33

14 Significant Ratios 35

CONCLUSION
15
16 Comments 38

17 Conclusion 41

18 Bibliography 48

5
INTRODUCTION:-

The story of one of India's favorites brands

reads almost like a fairy tale. Once upon a time,
in
1892 to be precise, a biscuit company was started
in a non-descript house in Calcutta (now Kolkata)
withan initial investment of Rs. 295. The
company we all know as “Britannia” today.
Initially,biscuits were manufactured ina small
housein central Kolkata. Later, the enterprise
was acquired by the Gupta brothers mainly
Nalin Chandra Gupta, a renowned attorney, and
operated under the name of " V . S. Brothers
“. In1918, C.H. Holmes, an English
businessman 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 big demand during World War II, which gave a
boost to the company’s sales.
The company name finally was changed to the current "Britannia Industries Limited" in
1979. In 1982 the American company Nabisco Brands Inc. became a major foreign
shareholder. The beginnings might have been humble the dreams were anything but.
By 1910, with
the advent of electricity, Britannia mechanised its operations, and 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.
As time moved on, the biscuit market continued to grow and Britannia grew along
with
it. In 1975, the Britannia Biscuit Company took over the distribution of biscuits
from
Parry's who till now distributed Britannia biscuits in India. In the subsequent public issue
of 1978, Indian shareholding crossed 60%, firmly establishing the Indian-ness of the
firm. The following year, Britannia Biscuit Company was re-christened Britannia
Industries Limited (BIL). Four years later in 1983, it crossed the Rs. 100 crores
revenue mark.
On the operations front, the company was making equally dynamic strides. In 1992, it
celebrated its Platinum Jubilee. In 1997, the company unveiled its new corporate identity -
"Eat Healthy, Think Better" - and made its first foray into the dairy products market. In
1999, the "Britannia Khao, World Cup Jao" promotion further fortified the affinity
consumers had with 'Brand
Britannia'. Britannia strode into the 21st Century as one of India's biggest brands and
the pre- eminent food brand of the country. It was equally recognized for its
innovative approach to products and marketing. The Lagaan Match was voted India's most

6
 successful promotional activity of the year 2001 while the delicious Britannia 50-50 Maska-
Chaska
became India's most successful product launch. In 2002, Britannia’s New Business
Division formed a joint venture with Fonterra, the world's second largest Dairy
Company, and Britannia New Zealand Foods Pvt. Ltd.was born. In recognition of its
vision and accelerating graph, Forbes Global rated Britannia 'One amongst the Top 200
Small
Companies of the World', and The Economic Times pegged Britannia India's 2nd
Most
trusted Brand. Today, more than a century after those tentative first steps, Britannia's
fairy tale is not only going strong but blazing new standards, and that miniscule
initial investment has grown by leaps and bounds to crores of rupees in wealth for
Britannia's shareholders.

The company's offerings are spread across the spectrum with products ranging from the
healthy and economical Tiger biscuits to the more lifestyle-oriented Milkman Cheese.
Having succeeded in garnering the trust of almost one-third of India's one billion

population and a strong management at the helm means Britannia will continue to dream big
on its path of innovation and quality and millions of consumers will savour the results. At
present, the company is growing at a steady rate, and is currently profitable. 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 Britannia’s annual revenue of Rs.22 billion comes from biscuits.
Britannia is one of India's 100 Most Trusted brands listed in THE BRAND TRUST
REPORT

7
OBJECTIVE OF THE STUDY:-
I. To know about the history of Britannia.
II. To know the major players and market share of Britannia.
III. To know the pricing method of Britannia.
IV. To study the financial statements of the company.
V. To analyze various ratios and commenting on them.

METHODOLOGY ADOPTED FOR THE STUDY:-

A. Observing the past and current conditionof the company.
B. Studying the financial statements of the company and its reports.

C. Considering standard ratios and other competitor’s ratios and commenting on the
company’s conditions with the help of ratios.

PRIMARY DATA:-
There was no primary data collected.
SECONDARY DATA:-
Secondary data was collected from various newspapers, magazines and internet.
Major Players in the Industry:-
1) BRITANNIA INDUSTRIES LTD. (BIL)

2) PARLE

3) ITC Ltd.

4) Surya Foods & Agro Ltd. (PRIYA GOLD)

8
Market Share:-

MARKET SHARE

BRITANNIA
PARLE
OTHERS

PRICING of the product has played an important role for the company to achieve
a major market share. For pricing company has taken into factors like fixed and variable
costs, competition, company objectives, proposed positioning strategies, target group
and willingness to pay. The pricing strategies adopted are:-
1) Competition Pricing:-They have set a price which is competitive when
compared with competitors.
2) Product Line Pricing:-Priced different products within the same product range
atdifferent price points. The better the feature and the benefit given the greater the
consumer will pay. This form of price discrimination assists the company in
maximizing turnover and profits.
3) Bundle Pricing:-The organisation bundles a group of products at a reduced
price when providing family packs.
4) Value Pricing:- They have also used value based pricing. Britannia has worked a lot
on fixing the price of its biscuits. It has packaged its product in various sizes at various
prices.Its biscuits ranges from RS 10 to RS. 20Cost Sheet:-

9
 Particulars Rs.
1.0
Cost of Production
0

1.5
Company Profit
0

0.5
Packaging
0

2.0
Promotion
0

1.0
Transportation
0

1.7
Selling and Distribution
5

7.7
Cost to Distributor
5

0.7
Distributors Profit
5

8.5
Cost to Wholesaler
0

0.5
Wholesaler Profit
0

9.0
Retailer Cost
0

1.0
Retailer Profit
0

10
 MRP 10.00

MILESTONE ACHIEVED/TIMELINE:-

Year Milestones Achieved

1892 The Genesis - Britannia established with an investment of Rs. 295 in Kolkata.
1910 Advent of electricity sees operations mechanized.
Imported machinery introduced; Britannia becomes the first company east of the Suez
1921 to use gas ovens.
Sales rise exponentially to Rs.16,27,202 in 1939.
1975 SalesriseexponentiallytoRs.16,27,202in1939.
1978 Publicissue-Indianshareholdingcrosses60%.
1979 Re-christenedBritanniaIndustriesLtd.(BIL).
1983 SalescrossRs.100crores
1989 TheExecutiveOfficerelocatedtoBangalore.
1992 BILcelebratesitsPlatinumJubilee.
1994 Volumescross1,00,000tonsofbiscuits
1997 newmission:'MakeeverythirdIndianaBritanniaconsumer'
1999 "Britannia Khao World Cup Jao"-a major success profitup by 37%
2000 Forbes Global Ranking- Britannia among Top 300small
No.1foodbrandofthecountry.
2001 BritanniaLagaanMatch:India'smostsuccessfulpromotionalactivityoftheyear.
MaskaChaska:India'smostsuccessfulFMCGlaunch.
BILlaunchesjointventurewithFonterra,theworld'ssecondlargestdairycompany
2002 BritanniaNewZealandFoodsPvt.Ltd.isborn.
Ratedas'OneamongsttheTop200SmallCompaniesoftheWorld'byForbesGlobal.
TreatDuet'-mostsuccessfullaunchoftheyear
2003
BritanniaKhaoWorldCupJaorockstheconsumerlivesyetagain
Britanniaaccordedthestatusofbeinga'Superbrand'.
2004 GoodDayaddsanewvariantChoco-nutinitsrange.
Volumescross3,00,000tonsofbiscuits.
Re-birthofTiger-'SwasthKhao,TigerBanJao'becomesthepopularchant
2005 ThenewplantinUttaranchal,commissionedaheadofschedule.
Britannialaunched'Greetings'rangeofpremiumassortedgift packs
FibreDigestivebiscuitsinaninternationallargesizedbiscuitpack
2006 Britanniaacquires51%stakeinBangalorebasedbakeryfoods retailerDailyBread
2007 BritanniaindustriesformedajointventurewiththeKhimjiRamdas
BritanniaNutri-Choice5Grainbiscuitslaunched-
2008 Biscuitswiththegoodnessof5healthcereals,andsweetenedwithnaturalhoney.BritanniaNutri
-
choicepromisedconsumers"BhookBhagao,KuchHealthyKhao".

11
 BritannialaunchedIronfortified'TigerBanana'biscuits,'Good
DayClassicCookies',LowFatDahiandrenovated'Marie-Gold'.

BritannialaunchesActi-Mind–Afirstofitskindmilkbasedhealth
drinkforkids,whichhelpsimprovementalsharpness.LaunchofActiMindmarkedBritannia'sen
tryintothebeveragesegmentandhasfurtherextendeditscreedof'EatHealthy,ThinkBetter'to'Dr
inkHealthy,ThinkBetter'aswell.
BritanniaNutri-ChoiceNatureSpiceCrackerslaunched-
YourfavoriteCreamCrackers,nowmadeevenmoreexcitingwiththeadditionofSabut,Ajwaina
ndJeeraspices.
BritanniatakesfullcontrolofDailyBread.
2009 BritanniaIndustriesbuysoutNewZealand'sFonterrafromexistingdairyjointventure,Britannia
NewZealandFoods(BNZF).
BNZFbecamea100%BritanniasubsidiaryandwasrenamedBritanniaDairyPrivateLimited(B
DPL).
Recognizingthechangingglobaltrends&healthbenefitsofremovingtrans-
fats,BritanniaisthefirstbakerybrandinIndiatoremovetransfatsfromitsproducts.
WadiaGroupacquiredstakeholdingsfromGroupDan-
oneandbecomesthesinglelargestshareholderinBIL.
Alwayscommittedtoconstantinnovation,BritannialaunchedBritanniaHealthyStartinMumb
aiinJanuary2011.SpeciallydesignedwithIndiantastesinmind,HealthyStartisacompleterange
ofready-to-
cookbreakfastmixesofUpmas,Pohas,PorridgesandOatsthatarehealthy,delicious,andtakejus
t5minutestocook.Thisistheonlyproductrangeinitscategorythatcombinesthenaturalnutrition
ofmulti-grains,100%realvegetables,pulsesandnutsallinonepack.
BritanniareceivedtheMostRespectedCompanyAward2011fromBusinessWorld.
55.
BourbonreceivedtheMostPopularConfectioneryProductPreferredbyYouth(Biscuit)Award.
56.CRBNQA(IndianMerchantChambersRamakrishnaBajajNationalQualityAward)confer
redtheManufacturingPerformanceExcellenceTrophyaNationalQualityAwardforthe2010cy
cle,forBritanniaCorporateOffice(Bangalore),BritanniaIndustriesLtd.(Rudrapur)andSunan
dramFoodsPvtLtd(Mangaldoi,Guwahati).
57. Britanniafurtherenhanceditsforayintohealthymilkbaseddrinks bylaunchingTiger-
2011 ZorChocomilk&Tiger-ZorBadammilkin
May2011.Thesearedeliciousmilkbasedbeveragesfortifiedwithactivenutrientsthathelpinthe
overalldevelopmentofmindandbody.
BritanniaBreadlauncheditsnewrangeofHealthBreadsinDelhiinNovember.Therangeconsist
sofHoney&OatsBread,Multi-GrainBread,100%WholeWheatBreadandMulti-FiberBread.
DelhifactorywasadjudgedasthewinnerforOutstandingPerformanceinFoodSafetyExcellenc
einthecategoryof'LargeFoodBusinesses-
Manufacturing',byCII.JBMFoodsPvt.Ltd.wasalsorecognizedwithRe-
commendationCertificateforStrongCommitmenttoExcelintheCategoryof'MediumFoodBu
sinesses-
Manufacturing'fortheyear2011.TheawardsweregivenattheCIINationalQualitySummitheld
atBangaloreon1stDecember2011.
BRITANNIAwashonouredwith„CREATIVEHRPRACTICESAWARD‟byEmployerBran
dingInstituteIndia,ontheoccasionof6thEmployerBrandingAwardsceremonyheldonthe10th

12
 ofDecember2011atHotelTajDeccan,Hyderabad.
IMCRamakrishnaBajajNationalQualityAward2011wasawardedtoBritanniaIndustriesLimi
ted,Bangalore,Bidadi,Delhi,Gwalior&Khopoliinthemanufacturingcategory,attheFifteenth
IMCRamakrishnaBajajNationalQualityAwardsandIMCJuranQualityMedalceremonyheldi
nMumbaion6thApril2017.
BritanniaIndustriesLimitedKhurdawascommissionedon17th April2017.
TheModernTradeteamofBritanniawashonouredwithWinner–
BESTBAKERYSUPPLIERawardfortheyear 2011-
12,atthe1stSPENCER'SBestSupplierAwards2017on 22ndJune.17
2017 BritanniawasawardedtheGlobalPerformanceExcellenceAward
(GPEA)byAsiaPacificQualityOrganization(APQO)atthe18th
APQOInternationalConferenceonQualityinColombo,SriLankaonOctober14.Britanniawon
this"BestinClass"award,aninternationalrecognitionforitsmanufacturingunitsandtheoverall
processesofperformanceexcellenceadoptedbythecompany.BritanniaistheonlyIndianfooda
ndmanufacturingcompanytoreceivethisaward.
BritanniawonGlobalawardgivenoutby'WorldQuality
Congress'attheirawardceremonyatMumbaiheldon22ndand23rdNovember2017.

SWOT ANALYSIS

STRENGTHS

1. Strong Parentage:- Group Danone has a 22% stake in Britannia Industries. Danone
isnumber 1 worldwide in dairy products, number 2 in bottled water and biscuits

2. Britannia Brand Name:- Britannia is already a well-established name in the minds

of Indian Consumers. They have delivered sustained quality in return, reaped the
benefits of consumer loyalty.

3. The Biscuits Business:- Biscuits contribute over 80% to the revenues of Britannia.
The
Indian biscuit market is worth around Rs 4500 cr and the organized segment
contributes Rs.2500 cr to the total. The Biscuit market is growing as a whole, thus
Britannia stands to benefit just by maintaining itself.

4. The Tiger Brand:- Britannia’s Tiger brand is very successful inits segment.
Launched as direct competition to Parle’s Glucose Biscuits, it contributes 25% of the
Companies
Volumes and 19% of its Sales

5. The Premium Range:- Britannia faces no competition at all in its premium range of
Biscuits .It’s cream treat range of product aer at present the only player in the
segment.

6. Innovation:-Britannia has been consistently adding new products to its existing

lines, and has been successful also because of its strong distribution network. It has

13
 introduced a new range of namkeens in Mumbai called Britannia Snax. IT added the
Sweet Lassi and Cold Coffee to its flavored milk line.

7. Superior Marketing Skills:-Britannia has Time and Again exhibited its

understanding and promotional schemes. Britannia had tied up with the makers of
‘Lagaan’. Britannia of the Indian consumer. This has been in the form of new
launches, innovative marketing has been associating itself with cricket and has
achieved good results.

8. The Dairy Business – Joint Venture with Fonterra Group:-India is the largest
producer of milk in the world with an output of 78 million tonnes per annum.
Britannia has transferred its dairy business to the Joint Venture. The new company
has full access to Fonterra's research and development strengths to help further
upgrade product quality and reduce product costs.

9. The Distribution Chain:- Britannia has built an enviable distribution chain across
the country in 2,200 towns with over 4,00,000 outlets. It is developing this network
further with a bias towards the Rural Areas.

10. Leveraging the Net:- They were able to avail end-to-end procurement services and
use procurement and reverse auctions to tap over 82 suppliers leading to new
supplier/price discovery. They achieved 5 per cent cost savings and continues to use
e-procurement extensively to utilize more cost effective transport routes.

WEAKNESSES

1. Danone India:- Grouped Danone has set up a wholly owned subsidiary Danone
India to market its mineral water product Evian. Depending on how this brand
develops, it might
become a competitor to Britannia.

2. Loss of Flexibility:- As long as Britannia were sourcing their milk products

fromDynamix, they enjoyed a certain amount of flexibility, this will not be possible
in their new venture, since it will run through the entire production process in –
house.

3. Fallout of the Sunil Alagh Incident:- A lot of things that made Britannia what it
istoday happened under the leadership of Mr. Sunil Alagh. The Sudden termination
of his term 9 months before the completion of his term, after serving as MD for 10
years is ound to raise questions about the company.

14
 4. Over Dependence on Biscuits:-Britannia is relying heavily on it’s income from
thebiscuits segment. This will not harm the company as long there are no bad
monsoons or other incidents that may jeopardize their production. Britannia must
develop it’s other product lines so as to be more certain.

OPPORTUNITIES

1. The Dairy Market:- Although Amul is a big

player in the dairy products market,
theunorganized sector is so big, that several more
‘Amuls’ can be accommodated.

2. Expansion:- There still remains a good

opportunity for expansion, since the biscuit
fieldhas many players in the organized sector.

3. Diversification:- Britannia should add new

products to its portfolio to compete withrival
brands. This will ensure its survival and give it a
chance at market Dominance.

4. Promotion of Parent Company‟s Products:- Britannia can promote the products

of itsParent Company Groupe Danone, which is one of the largest in the world. In
this way it can avion developing a competitor in Danone India.

THREATS

1. Market Competition:- Although Britannia currently dominates the market to a

goodextent, it is threatened by the forays made by several firms, especially the joint
Ventures between MNC, like Nestle and HLL and Priya Gold has doubled its
Production facilities.
These MNCs can flood the market with products from their parent companies.

2. Increase in Excise Duty:- The increase in excise duty on biscuits in the low cost
bracketwill have an impact on Britannia, in particular it’s Tiger Brand.

3. Environment:- The FMCG market in general if showing recessionary

tendancies.Although, Britannia has come out unscathed so far, It will only get more
difficult to grow and develop.
4. Regulations:- The Government has agreed to form and implement a plan and
committeeto control specifications for the production of foods. This will be an
additional cost on
the company.

5. Accusations of Unfulfilled Claims:- There have been reports published of

15
 manufacturers who failed to live up to the claims they make, eg. the quantity of minerals in
their product. Although Britannia has never been guilty of such activity, it destroys
consumer confidence.

 Customer behavior

Shift Biscuit industry in low-price segment faces stiff competition from other foods
category viz. nankeen, chips etc. These are also in the low price segment (RS 5-10 category)
and have the advantage of lower taxes.
VAT on this food segment is 4%while Biscuit segment is levied a VAT of 12.5%. Lower
taxes provide for higher profit margins and stiffer competition in supply chain.

1) Are you aware about Britannia Company?

No. of Consumers 30
Yes 28
No 02

Yes
No

28

16
2) For what Purpose Britannia company Known for?

No. of Consumers 30
Electronic Products 01
Cleanliness Appliances 02
Furniture & Furnishing 01
Food 25
None of the above 01

1
2
1
1
Food
Electronic Products Furniture & Furnishing Cleanliness Appliances
None of the above

25

17
3) How did you come to know about Britannia products?

No. of Consumers 30
Through Advertisement 12
Through Customers 9
Through Internet 6
Through others 3

6 12
Through Advertisement
Through Customers Through Internet Through others

18
4) Are you used Britannia Products?

No. of Consumers 30
Yes 26
No 04

Yes
No

26

19
 5) Which Britannia’s product you used most?

No. of Consumers 30
Biscuit 18
Bread 05
Milk 02
All of the above 05

2 Biscuit
Bread Milk
All of the above

18
5

20
6) Is Britannia Product price range affordable to common
People?

No. of Consumers 30
Yes 24
No 06

yes
No

24

21
7) What do you think Britannia’s biscuit is preferable
with?

No. of Consumers 30
Biscuit 18
Bread 05
Milk 02
All of the Above 05

2 Biscuit
Bread
Milk
All of the above

18
5

22
8) Which Biscuit you used mostly of Britannia ?

No. of Consumers 30
Good Day 14
Fifty Fifty 04
Little Hearts 03
Bourbon 09

Good Day
14 Fifty Fifty Little Hearts
Bourbon

23
9) Which company is competing Britannia Products in the
Indian market?

No. of Consumers 30
Parle 15
Priyagold 05
Other 10

10

Parle
Priyagold
15
Other

24
10) Do you think offers and schemes on Parle product are
good/satisfactory?

No. of Consumers 30
Yes 22
No 08

Yes
No

22

25
FINDINGS AND SUGGESTIONS

Britannia Products Have Global Image.

Customer trust on brand of product and name of company while purchasing the product.

The Company always tries to deliver a good quality and taste products at reasonable and
affordable prices

The Company should take necessary actions on complaints made by customers in order to
satisfy them.
The Company should satisfy their employees by giving them bonus, incentives, medical
Allowances etc.

I have studied and analyzed the food products market of Britannia on different
aspects of the market strategy and consumers.
According to me, a growth of any product is based on different aspects like
manufacturing good quality products, it should be well packed, it should have
different quantities, preparing goods with the help of affordable price, publish
their products with the help of advertisement, internet, newspapers etc,
maintaining good and healthy relations with their customers, analyzing market
structures along with their competitors etc.

DATA ANALYSIS AND COLLECTION:-

BRITANNIA ANNUAL REPORT 2017 - 2018

BALANCE SHEET Rs. in crores

As at 31 March 31 March
2018 2017

I. EQUITY AND LIABILITIES

(1)Shareholders’ funds

(a) Share capital 23.91 23.89

(b) Reserves and surplus 612.50 496.15

26
 636.41 520.04

(2)Share Application Money Pending 2.29 -

(3)Capital Subsidy 4.82 -

(4)Non-current liabilities

(a) Long-term borrowings 0.14 28.15

(b) Deferred tax liabilities (net) 13.62 8.16

(c) Other long-term liabilities 19.18 19.91

(d) Long-term provisions 138.56 116.82

171.77 173.04

(3)Current liabilities

(a) Short-term Borrowings 189.24 -

(b) Trade payables 333.61 336.20

(c) Other current liabilities 210.49 518.26

(d) Short-term provisions 134.40 124.80

867.74 979.26

1683.03 1,672.34

II. ASSETS

(1) Non-current assets

(a) Fixed assets

(i) Tangible assets 437.76 370.63

(ii) Intangible assets 13.92 8.46

(iii) Capital work-in-progress 128.44 79.73

580.12 458.82

27
 (b) Non-current investments 234.10 218.40

(c) Long-term loans and adv. 141.31 125.02

(d) Other non-current assets 12.12 12.12

(2) Current assets 45.50 210.54

(b) Inventories 331.49 382.28

(c) Trade receivables 77.12 52.14

(d) Cash and bank balances 64.48 30.94

(e) Short-term loans and adv. 196.79 182.08

715.38 857.98

1683.03 1,672.34

BRITANNIA ANNUAL REPORT 2017 - 2018

STATEMENT OF PROFIT AND LOSS

Rs. in crores

For the year ended 31 March 31 March

2018 2017

28
 I. Revenue From Operations

Sale of products 5649.66 5,005.66

Less: Excise duty (85.28) (58.62)

Net sale of products 5564.38 4,947.04

Other operating revenues 51.11 27.15

5615.49 4,974.19

II. Other Income 55.47 58.53

III. Total Revenue (I + II) 5670.96 5,032.72

IV. Expenses:

Raw materials including packaging 2890.42 2,655.01

materials consumed

Purchase of stock-in-trade 638.18 529.53

29
 Changes in inventories of finished goods, (10.16) (4.79)
work-in-progress and stock-in-trade

Employee benefits expense 143.50 145.87

Finance costs 37.74 38.07

Depreciation and amortisation expense 57.08 47.32

Other expenses 1582.02 1,369.34

Total Expenses 5338.78 4,780.35

V. Profit Before Tax (III – IV) 332.18 252.37

VI. Tax Expense:

(1) Current tax

Income tax 92.85 63.71

(2) Deferred tax 5.46 1.92

VII. Profit / (Loss) For The Year (V –VI) 233.87 186.74

30
 BRITANNIA ANNUAL REPORT 2017 - 2018

CASH FLOW STATEMENT

Rs. in crores

For the year ended 31st March 2018 31st March 2017

Cash Flows From Operating Activities

Profit before tax 332.18 252.37

Adjustments For:

Depreciation and amortization 57.08 47.32

Provision / (reversal) for diminution in value - 2.35

of investments, net

Profit on sale of investments, net (14.73) (9.10)

Profit on sale of fixed assets, net (7.98) (16.40)

Dividend income (0.23) (0.19)

Interest income (32.35) (32.12)

Interest expense 37.74 38.07

Operating Profit Before Working 371.71 282.30

CapitalChanges

(Increase) / decrease in inventories 50.79 (71.08)

(Increase) / decrease in trade receivables (24.98) 5.12

(Increase) / decrease in loans and advances (64.11) (62.70)

and other assets

(Increase) / decrease in bank balances (other (5.82) (0.88)

than cash and cash equivalents)

Increase / (decrease) in liabilities and 23.86 107.54

provisions

Cash Generated From Operations 351.45 260.30

31
 Income taxes paid, net of refund (79.44) (49.64)

Net Cash Provided By Operating Activities 272.01 210.66

Cash Flows From Investing Activities

Purchase of fixed assets ( including finance (192.88) (191.20)

leased assets)

Proceeds from sale of fixed asset 8.80 20.14

Sale of investments, net 164.07 122.82

Inter-corporate deposits placed, net 60.00 -

Loans given to subsidiaries (29.31) (37.96)

Loans repaid by subsidiaries 7.24 2.27

Interest received 35.74 32.18

Dividend received 0.23 0.19

Net Cash Used In Investing Activities 53.89 (51.56)

Cash flows from financing activities

Re-payment of secured loans, net (400.58) (0.83)

Interest paid (38.74) (37.66)

Proceeds from Share Allotment 1.44 -

Proceeds from Share Application Money 2.29 -

Pending

Proceeds from Capital Subsidy 5.00 -

Proceeds from Unsecured Loans 189.24 -

Dividend paid including tax thereon (117.76) (90.06)

Net Cash Used In Financing Activities (359.11) (128.55)

Net increase in cash and cash equivalents (33.21) 30.55

32
Cash and cash equivalents at the beginning of the 26.19 (4.36)
year

Cash and cash equivalents at the end ofthe (7.02) 26.19

year (Refer note on next page)

NOTE:-
For the year ended 31st March 31st March
2018 2017

Cash and cash equivalents at the end of 53.91 26.19

the year

Book overdraft (60.93) -

(7.02) 26.19

COMPARATIVE BALANCE SHEET

Rs. in crores

33
 As at 31 March 31 March Absolute %
2018 2017
Increaseor
Increase
or
Decrease

Decrease

I. EQUITY AND LIABILITIES

(1) Shareholders’ funds

(a) Share capital 23.91 23.89 0.02 0.08

(b) Reserves and surplus 612.50 496.15 116.35 23.45

636.41 520.04 116.37 22.37

(2) Share Application Money 2.29 - 2.29 -

Pending

(3) Capital Subsidy 4.82 - 4.82 -

(4) Non-current liabilities

(a) Long-term borrowings 0.41 28.15 (27.74) (98.54)

(b) Deferred tax liabilities (net) 13.62 8.16 5.46 66.91

(c) Other long-term liabilities 19.18 19.91 (0.73) (3.67)

(d) Long-term provisions 138.56 116.82 21.74 18.61

171.77 173.04 (1.27) (0.73)

(3) Current liabilities

(a) Short-term Borrowings 189.24 - 189.24 -

34
 (b) Trade payables 333.61 336.20 (2.59) (0.77)

(c) Other current liabilities 210.49 518.26 (307.77) (59.39)

(d) Short-term provisions 134.40 124.80 9. 7.69

6
867.74 979.26 (111.52) (11.39)

1683.03 1,672.34 10.69 0.64

II. ASSETS

(1) Non-current assets

(a) Fixed assets

(i) Tangible assets 437.76 370.63 67.13 18.11

(ii) Intangible assets 13.92 8.46 5.46 64.54

(iii) Capital work-in-progress 128.44 79.73 48.71 61.09

580.12 458.82 121.30 26.44

(b) Non-current investments 234.10 218.40 15.70 7.19

(c) Long-term loans and adv. 141.13 125.02 16.11 12.89

(d) Other non-current assets 12.12 12.12 NIL NIL

(2) Current assets 45.50 210.54 (165.04) (78.39)

(b) Inventories 331.49 382.28 (50.79) (13.29)

(c) Trade receivables 77.12 52.14 24.98 47.91

35
(d) Cash and bank balances 64.48 30.94 33.54 108.40

(e) Short-term loans and adv. 196.79 182.08 14.71 8.08

715.38 857.98 (142.60) (16.62)

1683.03 1,672.34 10.69 0.64

BRITANNIA ANNUAL REPORT 2017 - 2018

36
 COMPARATIVE STATEMENT OF PROFIT AND LOSS
Rs. in crores

For the year ended 31 March 31 March Absolute %

2018 2017 Increase or
Increase
Decrease
or

Decrease

I. Revenue From Operations

Sale of products 5649.66 5,005.66 644 12.87

Less: Excise duty (85.28) (58.62) (26.66) (45.48)

Net sale of products 5564.38 4,947.04 617.34 12.48

Other operating revenues 51.11 27.15 23.96 88.25

5615.49 4,974.19 641.30 12.89

II. Other Income 55.47 58.53 (3.06) (5.29)

III. Total Revenue (I + II) 5670.96 5,032.72 638.24 12.68

IV. Expenses:

Raw materials including 2890.42 2,655.01 235.41 8.87

packaging materials consumed

Purchase of stock-in-trade 638.18 529.53 108.65 20.52

Changes in inventories of (10.16) (4.79) (5.37) (112.11)

finished goods, work-in-
progress and stock-in-trade

Employee benefits expense 143.50 145.87 (2.37) (1.62)

37
Finance costs 37.74 38.07 (0.33) (0.87)

Depreciation and amortization 57.08 47.32 9.76 20.63

expense

Other expenses 1582.02 1,369.34 212.68 15.53

Total Expenses 5338.78 4,780.35 558.43 11.68

V. Profit Before Tax (III – IV) 332.18 252.37 79.81 31.62

VI. Tax Expense:

(1) Current tax

Income tax 92.85 63.71 29.14 45.74

(2) Deferred tax 5.46 1.92 3.54 184.38

VII. Profit / (Loss)For The 233.87 186.74 47.13 25.24

Year (V – VI)

SIGNIFICANT RATIOS

38
 2016- 2017-
17 2018

Measures of
Investment

36.7 35.9
Return on Net profit
Equity %

Shareholders’ funds

19.57 15.63

Earnings Per Net profit Rs.

Share

(NV of Rs. 2) Number of equity shares

2 1.6
Earnings per share (Basic)
Dividend Cover Times

Dividend (plus tax) per share

39
 Measures of
Performance

5.9 5.0
Profit before tax
Profit Margin %

Revenue from operations +

Other income

73.3 96.0
Sale of products
Debtors Turnover Times

Trade receivables

40.7 39.2
Sale of products
Stock Turnover Times

Inventories (Finished goods +

Stock-in-trade)

40
Measures of Financial
Status

33.9 83.6

Debt Equity Ratio %

Long-term borrowings + Current
maturities of long-term debt and
finance lease obligations

fund
Shareholders’ s

0.8 1.5

Current Ratio Times

Current assets

Current liabilities – Current

maturities of long-term debt and
finance lease obligations

29.6 26.0
Provision for tax
Tax Ratio %

Profit before tax

41
COMMENTS & CONCLUSION:-

Return on Equity Capital:-Return on equity capital ratio calculates the amount of

profits

available to take care of equity dividends, transfer to reserves, etc.

1) The return on equity capital is 36.7%.

2) It indicates that on each Rs.100 of equity capital:-

a) Average net return of Rs.36.7 is earned.

b) This amount of Rs.36.7 is available for appropriation to equity shareholders.

3) There is a good scope to attract fresh funds by issue of equity shares by

way of rights or public issue.

Current Ratio:- Current ratio is a liquidity/solvency ratio which indicates the ability
of a concern to meet its short-term liability.

1) Rs.0.8 of current asset is available for each Re.1 of current liability.

2) Current ratio has changed in the current year. For the last two years it
was constant.
3) Low values for the current or ratios indicate that a firm may have
difficulty meeting current obligations.

4) Low values, however, do not indicate a critical problem.

5) If an organization has good long-term prospects, it may be able to borrow

against those prospects to meet current obligations.

42
Debt-Equity Ratio:-Debt-equity ratio is a solvency ratio which indicates the
proportion

of debt and equity in financing of the assets of the concern.

1)A less than 1 ratio indicates that the portion of assets provided by stockholders is
greater than the portion of assets provided by creditors and a greater than 1 ratio
indicates that the portion of assets provided by creditors is greater than the portion of
assets provided by stockholders.

Creditors usually like a low debt to equity ratio because a low ratio (less than 1) is
the indication of greater protection to their money. But stockholders like to get
benefit from
the funds provided by the creditors therefore they would like a high debt to equity
ratio.

3) Debt-Equity ratio is 33.9% which means that long term loans(debts) are 33.9% of
shareholders’ funds.

4) It indicates that:-

a) There is very good safety margin for the long term creditors.

b) More dependence on equity.

c) Ease of raising additional loans.

d) Smaller burden of fixed interest payments.

Stock Turnover Ratio:-Stock turnover ratio shows the relationship between the cost
of goods sold and the average stock.

1) Stock turnover ratio is 40.7 times which means that during the year
stock was converted into sales 40.7 times.
2) Stock Velocity will be 365/40.7 = 9 days which means that on an
average 9 days production will be held by company as stock or it also means that it
takes
9 days for the company to sell stock after it is produced.

3) Stock is sold out fast.

4) Working capital requirement is less.

43
 Debtors Turnover Ratio:-Debtors turnover ratio shows relationship between credit
sales

and debtors. Its purpose is to calculate the speed with which debtors get settled on an
average during the year and to calculate debtors velocity to indicate the period of credit
allowed to an average debtor.

1) The debtors turnover ratio is 73.3 times which shows that debts are being
collected at a fast speed during the year.
Debtors Velocity will be 365/73.3 = 5 days which shows that on an average ittakes 5
days to settle a debt.

3) The amount of credit given by the concern to its customer is less.

4) Less funds are blocked up in debtors and working capital.

5) There are less chances of bad debts.

6) The debtors are managed very efficiently.

Profit Margin Ratio:-Profit margin ratio helps to judge how efficiently the concern
ismanaging all its activities of operations, financing and investment and how much amount is
available for appropriation.

1) The profit margin has increased from 5% to 5.9%.

2) All activities of the company are managed efficiently.

3) There is very good control over all cost ,i.e, operating as well as non-operating
cost.
4) A good margin is available to make appropriation.

Dividend Coverage Ratio:-Dividend coverage ratio indicates the capacity of a

company to pay dividends out of profit attributable to the shareholders.

1) The dividend coverage ratio is 2 times which is very well above the standard
ratio of 1.5 times.
2) It was constant for past two financial years which shows that company was
retaining similar portion of its earnings to meet its financial requirements but in this
year it has increased.

44
Earnings Per Share:-Earning per share calculates the amount of profits available
to

take care of equity dividends, transfer to reserves, etc.

1) The earning per share has increased from Rs.15.63 to Rs.19.57 (NV is Rs.2).
It indicates that on each Rs.100 of equity capital:-

a) Average net return of Rs.19.57 is earned.

b) This amount of Rs.19.57 is available for appropriation to equity shareholders.

3) There is a good scope to attract fresh funds by issue of equity shares by way of
rights or public issue.

Britannia Industries Limited is also a major

player in the ready to eat food segment with

leadership position in bakery category.

The companys’ plants are situated in
Kolkata, Delhi, Chennai, Mumbai,
Uttarakhand, Orissa & Bihar with a
capacity of 160,000 MT.
The company has transformed itself from
being a primarily a biscuit company in 2008

with diversification efforts into other bakery

products & dairy. Britannia made its strong
presence felt in dairy this year and recently
forayed into ready to eat Indian breakfast

market & savory market. We expect this new initiative to start yielding results from

2014. Companys’ product categories are all growing at +15% while the overall
industry

is growing at +10%. The company has over last 3-4 years done the innovations in its product
portfolio in all facets such as pricing, packaging and entry into new segments.

Innovation has been focused on growing its segments with the base of health and

nutrition. The company has over the years innovated its product portfolio so as to command
pricing premium in the market. Brand leverage has helped Britannia gain foot hold in new
segment such as chaas and healthy bread offerings. Innovation backed by advertisement

45
exposure to help improve growth. Britannia accelerated the nutritional drive in the last 3-4
years and has been growing in double digits in this segment. The adults Health and Wellness
segment is growing at +20% levels and Britannia is witnessing similar to higher growth.
Approximately 50% of its revenues flow in from this health & wellness segment.

In an increasingly challenging environment and continuing commodity inflation, Britannia

net profit has increased by 21.89% ,i.e, from Rs.186.74 crores to Rs.233.87 crores. The
company held its overall share of about one-third of the biscuit market, strengthened its
position in other bakery products like bread, cake & rusk and added Rs.775.07 crores to sale
of products, which grew
18.32%. Earnings per share of Rs.2 were Rs.19.57. In the
domestic market, competitive intensity in both bakery and dairy will continue to increase
as more players, both multinational and local companies, compete for a greater share of

the large and growing packaged food segment, of which biscuits account for the highest
share. Growth is expected to be driven through heavy investment in advertising &
promotions as well as infrastructure investments to build scale and support new
introductions, both in the premium and discount segments. Also, Britannia Nutrition

Foundation continues to work on initiatives related to malnutrition in children and

women and will partner with the government, NGOs etc., to pilot and scale up
successful initiatives.

46
BIBLOGRAPHY

1.WWW.BRITANNIA.CO.IN

2.WWW. MONEYCONTROLL.COM

3.WWW.WIKIPEDIA.COM

4.WWW.BUSINESSTANDARD.COM

5.WWW.ECONOMICTIMES.COM

6.WWW.JUST-FOOD.COM

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