Britannia to have plants in Bengaluru, Erode by December

FMCG company Britannia Industries Ltd (BIL) on Tuesday said it is coming up with two new plants near Erode in Tamil Nadu and Bengaluru to enhance its manufacturing capacity.

Each of these plants will have a production capacity of 50,000 tonnes per annum and the total investment will be to the tune of Rs. 200 crore.

"Our current manufacturing capacity is eight lakh tonnes per year and to keep up with the market demand at least 10 percent increase in capacity each year is needed. Our objective is to build scaled facilities," managing director Varun Berry told media persons here after the company's AGM.

These projects are expected to be completed by the end of December this year and land for these projects were procured for Rs.50 crore.

Besides these two greenfield projects, the company will also increase its production capacity in its plant in Gujarat for which it will invest Rs. 25 crore.

The company has set Rs. 500 crore this fiscal for capex.

Post completion of the Erode and Bengaluru plants, the total number of plants owned by the company will number at 14 while another 28-30 plants are under contract manufacturing.

"First, we have identified 14 plants which can be scaled up and the rest will continue with its existing manufacturing capacity. We'll take a call on these units later," said Berry.

Berry said the company is aiming to become a "total foods company" in the long run and is focusing on its distribution chain to penetrate more markets.

"We'll immediately focus on villages which has a population count of more than 10,000, thereafter we'll focus on the ones with a 5,000 population count and in three year's timeframe will cover the rest of villages," he said.

BIL chairman Nusli Wadia said the company is making the necessary efforts to maintain the food safety and quality standards for its products to avoid any untoward incident which has lately rocked the food industry.

During the AGM, he said food-product makers face a tough situation in the country as they don't have any direct control over the quality of the raw materials procured.

"We have to be more rigorous in terms of food safety because we do not have control over raw materials," he said.

Wadia said developed countries still have some amount of control over the raw materials it procures to produce their foodstuff.

The comment comes in wake of the controversy shrouding the noodle industry in India.

"We need to avoid any unfortunate incident which happened to other companies," he added.