Tag: biscuits

Coming soon! Cremica cookies and English Oven burger buns to West and South India

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Bectors Food” isinid=”INE495P01012″ bseid=”543253″ nseid=”BECTORFOOD” sector=”Consumer Food” exchange=”nse”]

Mrs Bectors Food Specialities — the makers of the Cremica brand of cookies and English Oven bakery products— aims to be a pan-India player in the next two years while staying focused on its core north Indian market.

“We have started our journey with volumes coming out of Mumbai, Pune and Bangalore. So we shall be putting up our facility in Madhya Pradesh (MP) to see that the coverage of those markets is done from our Indore facility,” Anoop Bector, Managing Director at Mrs Bectors Food Specialities told CNBC-TV18.

The company’s focus is going to be on north India but West and South India are also important markets, Bector added.

Mrs Bectors Food posted mixed quarter one FY23 earnings. The company clocked in strong revenue growth of over 30 percent but the margin has declined due to higher expenses. However, the company has managed to keep its gross margin steady at 44 percent in spite of steep inflation and expects to further improve the figure going forward.

The company’s strength is the premiumisation of its biscuits or its bakery products. The company’s overall business grew by 33 percent in quarter one of FY23 — biscuit business grew by 24 percent and bakery business grew by more than 50 percent.

“All businesses have done exceptionally well on the top line,” he said.

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In terms of raw material price softening, he said, “There is a softening of raw material prices, the vegetable palm oil prices have come down and so we are also looking at the reduction in packaging costs. Overall we feel there is going to be softening of prices and we shall be benefiting from that and it will help us increase our EBIT margins between 13 percent and 14 percent.”

“We will continue to work towards growing better than the competition,” he said.

Currently, the company is at 400 plus distributors in the north Indian market and it plans to double its direct distribution with its retailers.

“Currently we have 160,000 retail outlets direct reach, we plan to double them in two years to reach 320,000,” he said.

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The stock was up 6.77 percent in the last five days and 12.43 in the past month.

For the full interview, watch the accompanying video

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English Oven owner Mrs Bectors tanks 9% post large deals

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Bectors Food” isinid=”INE495P01012″ bseid=”543253″ nseid=”BECTORFOOD” sector=”Consumer Food” exchange=”nse”]

Shares of Mrs Bectors Food Specialities, which sells its products under its flagship brand ‘Cremica’ and ‘English Oven’ in India, tanked as much as 9 percent on Wednesday following reported block deals on bourses. However, the names of the buyers are not ascertained immediately.

About 96.3 lakh shares – representing 16.4 percent of the total equity of Mrs Bectors Food – worth Rs 295 crore changed hands at Rs 305 per share.

As many as 9.85 lakh shares changed hands on BSE so far on Wednesday as against a daily average of 0.5 lakh shares in the past two weeks.

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At 11:13 am, shares of the company were trading 5.9 percent lower at Rs 317.4 on BSE. The stock touched an intraday low of Rs 307 today.

Bectors Large Trade | 96.3 lakh shares (16.4% equity) worth ₹295 cr change hands at ₹305/sh pic.twitter.com/R4AGwoBwF2

— CNBC-TV18 (@CNBCTV18Live) April 13, 2022

The stock has been falling for the last five days and is down around 13.03 percent during the period. However, the stock had opened with a gain of 5.43 percent today.

Mrs Bectors Food’s stock had hit a 52-week low of Rs 278 on March 31, 2022. The stock has underperformed the market in the past 3-6 months after reporting a weak set of numbers.

In the past three months, the stock is down 17 percent whereas the Nifty500 index slipped 3 percent during the same period.

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Mrs Bectors Food reported a 25 percent year-on-year (YoY) decline in profit after tax (PAT) at Rs 16 crore in the third quarter that ended in December 2021 (Q3FY22) due to elevated raw material and packaging cost.

The Ludhiana-based company Mrs Bectors Food Specialities specialises in food production. According to its latest annual report, the biscuit and bakery firm is a leading brand in the premium and mid-premium biscuits category in north India, and one of the largest exporters of biscuit products from India.

The company has around 5 percent market share of the branded bread segment in India and 11 percent market share of semi-processed and dough-based offerings in India.

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Company’s RoCE has improved from 18% in FY18 to 24% in H1FY21: Bectors Food’s Anoop Bector

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Biscuits and bakery products maker Bectors Food Specialties opens its Rs 540-crore maiden public issue for subscription on Tuesday with a price band of Rs 286-288 per share.

CNBC-TV18’s Mangalam Maloo caught up with Anoop Bector, Managing Director of Bectors Food Specialities and talked about why the company’s EBITDA margins are lower than some of its peers despite gross margins being among the highest in the industry.

“We have been in the establishment and infrastructure build-up phase in the first two years and we have made a very large investment from 2018- 2020. Around Rs 250 crore were invested in building up one of the finest infrastructure.”

Bector said, “This year our domestic biscuits business has shown great numbers, as a company we have grown by 18 percent.”

“Today our RoCE is at 24 percent and ROE is at 22 percent, on annualised number, this is for the first half. We have shown exceptionally good numbers in this first half of these years.”

On market share, he said, “Industry size is Rs 45,000 crore, it is growing at 9 percent. For us as a company, we are a North Indian brand and we have a 4.5 percent market share in the premium and mid-premium segment of the biscuit side of the business.”

To know more, watch this interview.

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Seeing revival in demand on account of festive season, says Parle’s Mayank Shah

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Parle Products is witnessing some revival in demand largely because of the festive season, said a top executive of the company.

“Because of festive time we are seeing some kind of revival. I think we can vouch for revival or we can certainly say that there is a revival in demand next month when we see demand further continuing to be strong,” Mayank Shah, senior category head at Parle Products, told CNBC-TV18.

Talking about the tax cut, Shah said, “It’s a good cushion that has been offered by the government, but in the long-term if we are looking at a revival in demand, then probably, at least for our sector, what would make a difference would be goods and services tax (GST).”

“What would really revive the demand would be a cut in GST because that has a much bigger impact on demand and probably the pricing of the product than the corporate tax rate,” he said, adding “1/3rd of sales come from below Rs 100 per kg portfolio and balance 2/3rd comes from above Rs 100 per kg.”

Shah further said that the company was “absolutely okay paying 18 percent GST on biscuits priced above Rs 100 per kg because consumers at that end of the market do not mind paying that kind of GST”.

However, he added, “Consumers that we are talking about — middle-class, lower-middle-class and probably poorest of the poor, who consume biscuits below Rs 100 per kg are not in a position to absorb that kind of GST and that’s the reason we had asked for 5 percent.”

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Even small pack sales decline as FMCG sector reels under slowdown

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Historical drivers of growth in the fast-moving consumer goods (FMCG) industry seem to be showing a decline. Small packs, which make up 25-30 percent of overall sales for FMCG companies, have seen a decline in volume growth on a year on year basis.

Data sourced from market research firm Nielsen shows that three out of the top five high contributing categories for small packs have seen a decline in overall volume growth. Small pack categories for segments like biscuits, soaps and potato chips have seen a decline in volume growth in the January to July 2019 period (year on year).

For instance, the biscuits category saw a volume growth of 5 percent in the January to July 2019 period versus 7 percent in the same period last year. Small packs in the biscuits category contribute 70 percent of overall volumes for the category.

Recently, Varun Berry, managing director of Britannia Industries Ltd, Parle’s main competitor, said that consumers are thinking twice before buying a five rupee packs. “Obviously, there is some serious issue in the economy,” Berry had said on a conference call with analysts.

Similarly, the potato chips small pack category saw a volume growth of 15 percent in the January to July 2019 period against the 18 percent volume growth in the same period last year. Small packs in the potato chips category contribute 78 percent of overall volumes for the category.

Soaps too saw a volume growth decline on a year on year basis. Small packs in the toilet soaps space saw a volume growth of 0.1 percent in the January to July 2019 period against the 3.3 percent volume growth in the same period last year, according to data sourced from Nielsen.

Analysts say the decline in these categories could be because consumers are moving to larger packs that offer price benefits or moving to premium packs in some cases.

Chocolates, which is an impulse buy category, saw a volume growth of 12 percent in the January to July 2019 period against a 9.8 percent volume growth in the same period last year.

It will be critical to see how and when volume growth picks up in several of these categories in the small packs space.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow