Cadbury Plans To Hike Market Share
Cadbury India Ltd is planning to increase its market share in the chocolate and confectionery market. Increase in capacities and higher investment in marketing and advertising will help it achieve this, said Cadbury CEO and managing director, J M Robertson.
Addressing shareholders at the company's 49th annual general meeting, Robertson said their market share in India was around 70 per cent and it wants to further capture the market.
For increasing the market share, the company was investing Rs 40 crore each at Induri and Malanpur projects. The Malanpur plant capacity will be increased by 10,000 tonnes.
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Cadbury chairman, C Y Pal, said the expansion will be funded by a mixture of rights issue and internal accruals.
After the ongoing 1:5 Rs 38-crore issue, Cadbury's equity will rise from Rs 19.84 crore to Rs 23.81 crore.
Both Robertson and Pal tried to mollify irritated shareholders who questioned why the company had to pay Rs 2.60 crore as royalty to the parent, Cadbury Schweppes of UK.
Pal justified the royalty by saying that the parent was responsible for lending expertise in developing and marketing the brands like `Five Star' and `Gems' that are especially adapted to fit Indian conditions and tastes.
He added that these brands were the products of Cadbury India's R&D department which was very active.