Parle to ramp up biscuit manufacturing capacity

Parle Products Limited, one of India's largest biscuits and confectionery products makers, is planning to scale up its existing manufacturing capacity across the country.

The company plans to ramp up capacities by an additional 10 percent to cash in on the increasing demand. The biscuit maker will shell out around Rs 50 crores for the expansion. Parle Products proposes to fund the process through internal accruals.

The company, which has over 50 plants across the country, is planning to expand its biscuit manufacturing facility, besides launching new products in snacks and confectionery segment in future. The expansion process is expected to complete within next 4-5 months.

"We are planning a capacity expansion in time to come. The expansions to be held at our manufacturing facilities located in various places across the nation such as Mumbai, Umbernath, Hubali, Chennai, Madurai, Kanpur, Delhi, Bengaluru and Nimrana (Rajasthan)," said Praveen Kulkarni, general manager (marketing), Parle Products Ltd.

"The increasing demand is the main reason for the expansion. The gap between demand and supply is increasing," he said, refusing to give further details.

With rising input costs, the company is taking measures to control costs. The prices for key raw materials such as wheat flour and sugar has increased by around 25-30 percent in the past 5-6 months, while the packaging cost rose by more than 40 percent during the period, say company sources.

“We are focusing on bringing our distribution and packaging costs under control. This accounts for almost 65 percent of our total cost,” said Kulkarni. The company recorded turnover of Rs 2,500cr for the financial year 2007-08 and it expects a 10 percent increase for the fiscal 2008-09.