Ladies and gentlemen, good day, and welcome to the Q4 FY 2022 earnings conference call of Britannia Industries Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Mayank Mundra. Thank you, and over to you, sir.
Thanks, Madhu. Hello, everyone. This is Mayank from the investor Relations team. I welcome you all to the Britannia earnings call to discuss the financial results of Q4 2021, 2022. Joining us today on the earnings call is our Managing Director, Mr. Varun Berry, Executive Director and CFO, Mr. N. Venkataraman, Chief Marketing Officer, Mr. Amit Doshi, Chief Procurement Officer, Mr. Manoj Balgi, and Chief Development and Quality Officer, Mr. Sudhir Menon. The analyst deck is uploaded on our website. Before I pass it on to Mr. Varun Berry, I would like to draw your attention to the Safe Harbor statement in the presentation. Over to Mr. Varun Berry with remarks on the performance.
Good afternoon, everyone. I'm very happy to be here with you. I'm taking this call from Cochin, where we are having a sales and marketing conference for the year as we go through. Moving to the analyst deck, if you were to move to page number three, all of us are aware of what we've gone through. We've seen many new things coming our way, you know, whether it was COVID one, two, three, inflation, geopolitical factors, et cetera. Everyone's aware of that, so I'm not gonna stress any of these points. It is a very challenging environment. However, in this environment, we continue to drive our revenue growth, and we've been reasonably able to sustain our profitability as well.
Next slide, which gives what we've achieved in the fourth quarter as well as the full year 2021, 2022. If you were to look at revenues from operation, the 12-month growth is 15% for the fourth quarter, and the 24-month growth is 25%, which is fairly healthy. Similarly, if you were to look at full year, our 12-month growth is 8%, and the 24-month growth is 22%. Profitability similarly, operating profit 10% growth for Q4 in the 12-month growth and 23% for 24 months growth. For the full year, -13% in 12 months, but for the last 24 months, it's 21% growth. I would say reasonably healthy growth.
Moving on to the next slide. This gives us the share numbers, as you will see we've broadened the gap with our largest competitor this year. So, we've continued to make progress as far as market share is concerned. We've gained, this is our 10th year of continuous share growth which I think for any company is a great performance and I'm very proud of this factor. Moving to the next slide. Again, same strategic planks, distribution marketing, cost leadership, innovation, adjacent businesses and sustainability.
Now next slide, driving efficiency in distribution; this year we made progress. Our rural distribution has gone up from 23,000 rural distributors to 26,000 rural distributors. We've made a steady progress in our direct reach as well. This has stymied a bit during COVID times but it's come back. In March 2022, we are up to almost 25 lakh outlets. Hindi belt is growing 20% faster than the rest of India. However, I must say that there are a few states which are emerging as states which need more attention. These are the smaller Hindi the states and we are making sure that we work on it so that we can make these grow even faster.
Our channels are back. As you know that the modern trade channel had taken a little bit of a step backwards during COVID as people were afraid to go to a large store, et cetera. But this has come back in 2021, 2022 and the growth is 20% higher than what it used to be pre-COVID in 2019, 2020. We've had some very interesting marketing activities. We had relaunched Good Day.
We had the Multiple Smiles campaign, which has done very well for us. We had the Good Day Choco-chip TVC, as well as the relaunch, which is doing very well for us. Winkin' Cow, it has become a INR 100 crore brand for us, and we used the TVC for Winkin' Cow during this quarter, because this was season. Milk Bikis Atta is doing well in rest of India. Jim Jam, we have a thematic. That brand is showing a lot of promise for us. We've relaunched our Dahi brand under the Come Alive brand name. Similarly, TVCs on other brands as well.
On cheese, we've taken a protein promise, which seems to be holding up quite well for us, and we hope to scale this up as we go forward. On our cost leadership program, again, you know, the team has done a fantastic job of creating opportunities and reducing costs. If you were to look at it, in 2021, 2022, we were five times cost savings than what we were in 2013, 2014. In 2022, 2023, where the situation is looking fairly grim from an inflation standpoint, we are doubling up to make sure that we continue to take this trajectory, even better than what it has been in 2021, 2022. The cost levers are fairly familiar to all of you.
From a supply chain standpoint, it's the process automations to improve productivity, reducing distance to market, which helps us reduce cost, and also provide fresh product to our consumers. Reducing wastages, which happen either in the factory or in the marketplace. Alternate sources of energy, which, you know, we are looking at a target of getting to 60% renewable energy, so that's working quite well. From a material standpoint, our sourcing strategy is focused towards making sure that we get the best bang out of our buck. Backward integration to whatever extent possible, wherever we have some expertise within the system. We're also working on reverse auctions for all of our products that we purchase.
Optimization of the packaging specifications as the packaging material costs are going through the roof. Other areas are market returns, fiscal incentives, treasury returns, as well as reducing commitment charges to some of our contract packers by making sure that our forecasts are very close to what our achievements are. Moving on to the next slide. We've had some innovations during this quarter. Good Day Harmony, which is a very interesting product, is doing really well for us. 50-50, we've launched a product called 50-50 Golmaal in the East. Again, a very promising product. Initial response is extremely good. We did a Jeera Marie launch, which was done in collaboration with our consumers.
Again, doing you know very good initial responses, and we are hoping that this could become a blockbuster in the South. We also did two new additions to our Winkin' Cow brand, which was Kesar and Badam. We've relaunched our croissant with the new marketing mix. It's been relaunched in the South region as of two days ago. Before that, we'd launched a product called a croissant with you know mixed fruit in it, and this has been doing quite well for us. A Coconut Wafer, which is also just getting into the market in the last one month or so. Very interesting innovations and seeing a very good response from the market on all of these.
Adjacent business, you are gonna see some real excitement from Britannia as far as the adjacent businesses are concerned. We have had, you know, some learning phase in this area. I think today we are structured very well. We've got a very solid team which is handling each one of our verticals. I feel very good about where we are at with our product, some of our partnerships that we are looking at, et cetera. I feel that this is an area which we are gonna ratchet up on certainly this year. If you look at bakery adjacencies, we've seen a high double-digit growth across our divisions. We've also seen a healthy, consistent margin delivery in bread and rusk.
As far as, you know, croissant is concerned, as I was telling you, we finally cracked the code on the product. We've started to relaunch it. We didn't want to do it one shot across the country because we want to make sure that we give enough product to the regions before we move it across the country. I would say that with the South launch, we've sort of started this process, and in the next couple of months, it's gonna be across the country. It's taken us some time, but we are very, very happy with what we have as our final marketing mix. On the dairy part, strong quarter, we've had a robust double-digit growth. As I told you, Winkin' Cow is now in the INR 100 crore club.
In the international business, some challenges in the Middle East because of a distributor change that we did in UAE. Nepal, where we'd set up our own distribution and our own manufacturing, has given us very good results. Nepal now joins the INR 100 crore club for Britannia. Moving on to our sustainability programs and the journey thus far. As you know, we've got four pillars. One is the people pillar, and the programs under this are we want 50% of women workforce at a facility level by March 2024, and we are on track for this. We are looking at 1 lakh+ beneficiaries to be reached through our Britannia Nutrition Foundation. We've already done this.
We've achieved it, and now on to a new landmark for ourselves. 60% renewable electricity by March 2024. Again, on track. Eliminating 20 lakh kilos of plastic trays by March 2023. Completely on track. Water consumption to be reduced by 30% through recycling and reuse. Absolutely on track. Growth. On the growth pillar, we've looked at sodium reduction and sugar reduction in our products by 6% and 8%. Again, on track on both of those. On governance, we are looking at targeting second or third quartile in the S&P Global DJSI in food product sector this year. As you know, we've moved our DJSI scores from 11% to, I think, 37%.
We are looking at moving them even further. The three ESG policies, which is on sustainability, human rights, and vendor code, you know, we've got those policies documented. We are getting our entire ESG targets integrated with the ExCom KPIs. ExCom is me and my direct reports. All of us carry those key performance indicators in our, you know, targets for the year. That is where we are at. We are recognized amongst the top 40 of India's most sustainable companies by Business World. We are hoping that this, again, will become a very, very important plank for us, and we will take this to the limit in the coming years.
The other areas on sustainability, you know, identifying and implementing new programs to drive sustainable sourcing. Publication of a sustainable supply chain manual, which we are working on, continue to improve that I've spoken about, the DJSI score. Finally, development of a sustainability report which complies to all the international standards of disclosure. These are the ones that we are working on, you know, to make sure that we get completely up to speed. Now coming to the financials. This is our quarter numbers for the last 12 quarters. As you will see, you know, the last quarter has been INR 3,508 crores, and the full year has been 8% growth.
If you look at the growth of quarter four, it's 15%, and the 24-month growth is 25%, which I shared with you earlier as well. There have been, you know, geopolitical factors which are aggravating the inflationary scenario, and I don't think it's abating in any way. What has it done to us? You know, we, because of our forward commitments, we have been able to, you know, control some of our costs. However, the commodities have still witnessed an inflation of 17% and 14% for the quarter and full year respectively, right? Our flour is at 1%, sugar is at 7%, laminates at 20%, palm oil is at 26%, cashew at 35%, and corrugated boxes at 21%.
However, as I said, we have taken some forward positions which have helped us. What is our response to the inflationary pressure that we are facing? Obviously, there's nothing more important than taking the right amount of price increases, and which is what we've been doing. I must say that we've not been able to keep pace with this inflation because we never estimated the kind of inflation that we've seen. We continue to take judicious price increases. The other two pillars are the value creation for consumers. One is on controlled discretionary spends. We focused on, you know, our advertising and sales promotion spends. We've controlled our overheads, and we've leveraged our fixed costs as much as we could.
Cost efficiencies program, cost efficiency programs are already shared with you, but we are now at 5x the cost efficiencies that we were getting in 2013, 2014. We've accelerated these programs, and we've looked at IT transformations to make sure that we are completely on top of these, as far as our savings are concerned. Our operating profits, you know, you can see that our operating profits peaked during Q1 of 2021, which was, you know, a windfall because we'd optimized. We were only producing products. We were only producing the key brands. You know, the spends were not there because we were running out of product at that point in time. That was the peak.
From there onwards, we've come to approximately a 14.2% operating margin, which is a growth of 10% for Q4 and a 24-month growth of 23%, which is pretty similar to what it used to be pre-COVID. We have made sure that we remain handsomely profitable despite all the headwinds that we face. Moving on to slide number 21, which will show you all of the details on our financials, which I'm sure you've gone through. For Q4, 15% growth on the net sales, 10% growth on operating profit. Profit before tax is growing by 5% and profit after tax at 4%.
Similarly for the full year, if you look at, you know, the numbers, it's 8% on the top line, and it's a -18% from the peak that we'd seen in the previous year. 24-month growth for the full year is still positive. 22% growth on net sales and a 21% growth on operating profit, which is a reasonably good performance. If you look at, you know, the ratios down below, profit from operation at 14.3% in 2021, 2022. Profit before tax at almost 15% and profit after tax at 11%. That is it from me. I'll open the house for questions. Mayank?
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset mode while asking your question. We would also request participants to limit your question to two at a time. Should you have a follow-up question, please rejoin the queue. Thank you. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abneesh Roy from Edelweiss Securities. Please go ahead.
Yeah, thanks. Congrats, Varun, on very good performance. My first question is on the small Hindi states comment and then the focus states. You mentioned that more attention is needed for the small Hindi states. When I see the growth in focus states, slight slowdown is there at 1.2x versus 1.3x in previous quarter. Is it more of rural slowdown or is there any specific issue in some of the smaller states, any competitive intensity has increased there?
No. It's not about competition, Abneesh. What's happened is that, you know, during COVID, there were multiple priorities. Obviously, everyone was struggling to make sure that all of the KPIs are, you know, kept on track. We did see that UP is our largest state, right? It contributes over 50% of our total Hindi state, you know, sales, right? UP is blazing. UP is doing really well. There are some small states where we seem to have slipped, namely, Chhattisgarh. MP is okay-ish. MP is not blazing the way I would want it to. Chhattisgarh has slipped and so has Rajasthan. Those are opportunity areas where, we will make sure as a team that we get back to speed.
That is where I'm coming from. It's important that, you know, if there are some— You know, you've got to remember that our brand strength in those states is not as strong as what it is in some of our stronger states. A little bit of slippage, a little bit of less face time with our people because of COVID, et cetera, it hampers our progress to an extent. It's a matter of time. We will definitely get back on those small states as well.
Thanks. My second question is on the price hike. Initial expectation was that FY 2023 will need around 7% price hike over and above the 10% hike which was already taken in 2022. Post that things have clearly turned more adverse currently. What is the current expectation on price hike? FY 2022 65% hike was coming through grammage cut. Will there be any change in that ratio?
No, it'll probably be the grammage cut might end up being even higher than that. You see, the point is, sitting here, I don't know where we are headed as far as inflation is concerned. Clearly, two or three concerns. One is the wheat production in the country has been lower than what we had expected. While there was a lot of noise about exports and, you know, we can feed the world, et cetera, the point is that the crop has been poorer because of the severe heat. The wheat grains have shriveled up a bit, and even the production has been lower. We don't know where that is gonna lead us.
You know that, you know, between Russia and Ukraine, they produce almost 100 million tons of wheat, which might not get harvested. That gets harvested as soon as the snow melts. In Ukraine, there are no men to harvest it because they're all involved in fighting their war. There is gonna be pressure on that front, both nationally and internationally. Similarly, palm oil, as you know, Indonesia has stopped exports. There are ships with 3 lakh tons of oil which were about to sail, and now they've been stopped. Where that will go, nobody seems to know. I'm sure it'll get cleared up. It's a matter of time.
Luckily for us, we are covered till things become better. I would think that this is a year where we really have to be on our toes and you know take calls on a month-to-month basis. You know there is no way that any other activity can fulfill what you know the inflation, the pain that inflation is gonna give us. It will have to be a price correction. While we will try and be judicious about it and make sure that it doesn't impact the consumer in a big way, but we will have to take some tough calls.
Sure. Varun, just one very small follow-up on this question only, and that will be my last question. In Q3, you had -4% to -5% kind of impact on volume because of grammage cut, which I think will be fairly similar this quarter also. On a reported basis, you are seeing mid-single digit volume growth. What would be the industry volume growth in your sense in Q4? Your share gains, is it coming only from the number two player or even from the smaller players?
What happens, Abneesh, is you've got to understand that during severe inflationary times, the smaller players are the ones who get impacted the most. Gains are coming from the smaller regional players and, obviously from the number two player as well. It's a mix of both. The industry growth would be flattish to negative.
Thanks, Varun. That's all from me then. Thank you.
Thank you. The next question is from the line of Percy Panthaki from IIFL. Please go ahead.
Hi. Just continuing on what Abneesh was talking about in terms of the price increases. I'll make the question rather simple. Assuming that the current spot prices remain where they are for the next 12 months, what kind of additional price hikes do you need to take in your portfolio?
That's what I was trying to explain to Abneesh. It's very difficult to call that, because it's such a dynamic environment. It'll definitely be more than what we'd estimated in the beginning. To what extent, only time will tell. If things on palm settle down, if you know the war gets over, if. It's all about the ifs, Panthaki.
Right. Right, sir. That's why I put a simplifying assumption there saying that if the spot prices as of today continue for the next 12 months.
Did you say that? I'm sorry, I missed that. If the spot prices continue, it'll probably be about a 10% increase that will be required.
Over and above what's already taken?
Yes.
10 + 10, a total of approximately 20.
Right.
Okay. Secondly, just to understand, on sort of the adjunct categories, what kind of slightly longer term vision do you have over, let's say, a five-year horizon? Where do you see these adjunct categories? Which one do you think will see the fastest growth or become the biggest? And where do you see the biggest opportunity which can be sort of extracted over the next five years? That's part of the question. The other part of the question is that the salty or savory snacks category, which you had sort of launched in South India under the name of Time Pass, what really needs to happen for that category to become really big for us?
I mean, ultimately, that category is something which works on width and breadth of distribution, which is something that we already have with us. We already have a advantage at the starting point. What really is preventing us from becoming one of the bigger players in this category?
Let me answer your first question. I think obviously you know as I said during the presentation I feel very good about the way we are structured today. The way I'm here with the sales team the entire sales team from across the country is here. You know this morning we were talking about how we become you know a leader amongst more categories than just a few. I think the sales team is very clear about what we can do and how we can move forward. I also think that we've got a fair amount of you know strength we've got that threshold volume. We've got reasonable brands in most categories.
I would say, obviously the big ones will continue to be the larger ones. Cake, I think we've got many initiatives. I think cake and rusk will definitely have the potential to become INR 2,000+ crore kind of businesses for us. We have a lot of hope in dairy and some very, very exciting initiatives there. We know that Amul is the big brother, but I think we can do a lot more in the value-added space. As you might or might not know, we've crossed the INR 500 crore mark in dairy after you know many years of striving for it. We've had a very good growth this year, and there we've got great plans at the back end.
Croissant is something where I feel very excited about, because one, it's got entry barriers. It's not a category that everyone can launch. It requires a lot of attention because it's a new category to the Indian consumer. You really have to fine-tune it to an extent where the consumer tells you that this is what I want, and I think we've reached that stage. It probably took us you know, a little longer than I would have imagined. Today I feel very, very good about where we are at. If you get an opportunity, please try our new product, which should be in your markets in the next month or so. Feel very good about that.
We are not shy to evaluate partnerships wherever required. We have been working on some, and there are definitely opportunities there which could be very, very exciting. I personally am working on this area to make sure that we come up trumps as far as the adjacency business is concerned also. What was your second question? On salty. On salty, see, you can't do everything, you know, like, you've got everything ready. Because finally, it's a little bit of sussing the market, sussing the consumer, understanding. While our ran a salty business in the past, but you know that business was run in multiple countries and you know it had been fine-tuned over millions of consumers and you know all of that.
Brands had been constructed years ago, before Pepsi had bought that business, et cetera. It takes a long time. We are being very careful, and we are really reading into what our consumers are telling us in our test markets. We don't want to be in a situation where we go, you know, hell for leather, we launch it across the country, and then we realize that, you know, it's a situation where we'll have to take our products back. It's taking a bit of time. It took us a bit of time with croissant as well, but we've got to the finish line. Similarly, I would say I would rather be careful than aggressive in this area of adjacencies.
Right, sir. That's all for me. Thanks and all the best.
Yes, thanks.
Thank you. The next question is from the line of Kunal Vora from BNP Paribas. Please go ahead.
Yeah. Thanks for the opportunity, and congrats for a very good quarter. First question, how large is the contribution of low unit packs, and are you looking to vacate some of the price points? In our recent checks, we heard that you have done the two price points in certain markets. I mean, are these price points, like, meaningful for you, and how do we see the impact of this?
See, low unit price points in a country like India are impossible to vacate, right? Yes, over the years, if you look at it, you know, maybe 15 years ago, there used to be a large contribution of INR 2-rupee and INR 3-rupee packs, which have become minuscule today. Parle used to sell a lot of INR 2-rupee and INR 3-rupee packs. We also used to have a reasonable contribution of INR 2-rupee, INR 3-rupee. It's all migrated to INR 5 and INR 10, and thereafter. I don't think we are in any position to vacate the INR 5-rupee, you know, segment at this point in time.
As you know, as the world evolves, as the consumer evolves, and as we you know, get through all of this inflation, time will tell when is the time to really press the pedal on 10 and move on from INR 5. I don't think we are in any position to do that right now. It's about the price point packs. The INR 5 and INR 10 are approximately 50%, 55% of our total mix. It's fairly large. It continues to be in a country like this where you have a lot of bottom of the pyramid consumers, it continues to be a staple for a lot of consumers in a lot of parts of the country. That's where we are at, and we will have to nurture that business.
You still have INR 2-rupee price point, right? Like, how large would that be?
Our INR 2 rupee is very small. We don't have anything to really write home about. Maybe a few packs here and a few packs there. It's not like a big segment at all.
Okay. Understood. Second and last question. You mentioned you crossed INR 500 crore mark in dairy. I believe you were at INR 500 crore mark even two years back. I mean, like, if I recall the interaction in September 2020, you mentioned you were at INR 500 crores and you aspired to be at about INR 2,000 crores by 2025. I don't know.
We were never at INR 500 crore. We might have aspired, but we were around the INR 400 crore mark. This year our growths have been good, so we've crossed to INR 500 crores, which is no great achievement, frankly. If you ask me, you know, getting to INR 500 crores in so many years of launch is no great achievement. You know, you've got to celebrate your small victories, and that's what we are doing.
Sure. That time you were aspiring to be about INR 20 billion by in five, six years. Are you on track for that, or that looks difficult considering the changes in situation? Also, if you can update us about the Ranjangaon plant, dairy plant, what's the update now?
Yes, we would want to be at least an INR 2,000 crore business in dairy in the next five years. Maybe it's a moving target. Maybe I said that two years ago, and I'm saying it again, so don't hold me on it. This time, certainly we would want to get to INR 2,000 crores. The Ranjangaon plant is moving quite well. We've got all the equipment. The raw cheese manufacturing equipment should get commercialized in the next two or three months. We've got a yogurt line. We've got a powder line. We've got a drinks line. All of that should get commercialized in the next tjree-four months.
The only one which will take at least six-eight months is the processed cheese line, which should be done by December or January. By January of next year, we will be up and running. We've already moved up on milk collection pretty considerably. You know, what we are trying to do is get our milk collection to the highest level possible, because even if we have excess milk, we will consider you know, making milk powder out of it and using it in our bakery facility. We are gonna run that plant on full efficiency, and we are feeling very excited about it. We've got some very exciting products as well, possibly a few interesting partnerships as well.
We are feeling very good about where we are at. You know, I think, this year is gonna be the year where we'll take the turn as far as dairy is concerned as well.
That's good to hear. That's it from my side. Thank you, sir.
Thanks.
Thank you. The next question is from the line of Shirish Pardeshi from Centrum Capital. Please go ahead.
Hi, Varun and team. Thanks for the opportunity and happy—
Sorry to interrupt you. We cannot hear you very clearly, sir.
Actually, I can hear him.
Okay.
Am I audible now?
Yeah, Shirish, you are audible.
Yeah. Hi, Varun. Thanks for the opportunity, and congratulations to the whole team. I have got three, four questions. I'll try and shortcut, put it together. One, if you can spell out last two years we have ensured the market share. I mean, we have no idea, but if you can help us where we stand today, how much market share gain we have got in last two years, especially from FY 2019 onwards. Second, if you spell out something on the international. Because we keep hearing that we are trying to do something from the distribution channel perspective, but when do we see the meaningful contribution from the international business.
Third question is on ICD. When I look at the filing today morning, I think directly what I gather is that our BBTC has come down while Bombay Dyeing ICD has gone up. Against INR 811 crores, BB ICD directly has come down to INR 754 crores. Maybe if you can help, what is it that you're looking? Is it going to be going up or is it going to come down, and what timeframe?
Shirish, I missed your first. The second was international, third was ICD. What was your first question?
Share.
Okay. Market share. Okay. Share growth has been fairly good, Shirish. We don't give numbers because it's a syndicated study, and that's why we give you the trends. But approximately we've gained about 0.8 share points, so 80 basis points in the last two years. That's been pretty good because, you know, the fact is that it's been a continuous market share growth story for us. Feel good about that. International, yes. See, if you think about international, we are not looking at a big bang change to our international business. You know, it's very easy for us to, you know, look at big acquisitions, et cetera, but we are very careful about making sure that we get our paybacks if we are looking at big acquisitions.
What we did with Nepal is a testimony for a very good call that we took. We've turned that from a INR 10 crore, INR 15 crore business to a INR 100 crore business. That's a good call. Similarly, we've got some calls that we've taken in Africa as well. We've got two contract packers that we've put in place. Hopefully slowly and steadily we'll gain some base in these markets and be able to set up a foundation for growth for the future. Yes, UAE, which is our largest business, has been a little bit of a pain. The pain was because of you know, our distribution partner there.
We were not able to get them to, you know, implement and execute the way, we thought, we could, you know, get, a lot more business. We've got a very, very good partner now. You've got to remember that these markets, changeover takes a lot of time. See, what happens is if you're changing over, first you have to move all the stocks which are, with the other partner to this partner. Your secondary sales might not get impacted, but your primary sales do get impacted. Even, settling in, you have to register the new distributor. Three, four months go away in making sure that all of the accounts have your new distributor registered and then you start to sell. It's a very painful process.
We went ahead with it because we knew that we will see a benefit from this as we move forward. I think we are doing some interesting stuff in international. It's not as we had envisaged, I must admit. We haven't gained as much heft in the international business. We will continue to make sure that we get some interesting stuff going there and get our bases fixed. The other parts of the business have been doing really well. Europe, Americas, even Australia, Southeast Asia have been growing hefty double digits, but they are all on the basis of exports, and they are small businesses, so it's not making that much of an impact. I think again, this year could be a year of change as international is concerned as well. On ICDs, Venkat, could you comment on that, please?
Yeah, the total group ICD as of March 2022 stands at INR 740 crore. Bombay Dyeing of INR 350 crores and Bombay Burmah of INR 390 crores. Okay. This is against March 2021 of INR 790 crores, which is about INR 290 crores for Bombay Dyeing and INR 500 crores for Bombay Burmah. Both of these are within the approved limits for both the companies.
Venkat, I got that. Just if you can help, what is the roadmap? Is it going to go up? Or because on a quarter-on-quarter basis everything, it is up and down. Is there any strong case that ICD will get resolved, maybe in next four quarters?
It's not going to go up. That is for sure. The attempt is to see how we can dilute them as we go forward.
Sure. Varun , just one question I'd ask again is, because normally at the year-end you give the new product contribution. In INR 14,000 crores, what is the FY 2022 new product contribution if you have, and if you can share any guidance or targets for FY 2022?
Sorry, for FY?
2022. Against that INR 14,000 crores what you have reported as the top line, what is the new product contribution?
It's about 4.5%.
This number will be higher because we are now getting into dairy for FY 2022?
Yes, for sure.
Okay. Thank you, and all the best to you and the team.
Thanks.
Thank you. The next question is from the line of Vishal Gutka from Phillip Capital. Please go ahead.
Yeah. Hi, everyone. Two questions. One is on the brand front. The 50-50 Potazos, I think you extended from East India to other parts of the country. Just wanted to understand performance on that as well as on Milk Bikis, because Milk Bikis are very big brands. If you can give us some color in terms of distribution reach, growth rate, and advertisement planned, given that you've expanded from the strongholds of Tamil Nadu and Kerala to rest of India. Second question is on the CapEx plan for FY 2022.
I'll let Amit Doshi, who's our new CMO, to answer the first two questions, and then I'll tell you about the third one.
Hi. I think currently both of the brands, Potazos and Milk Bikis, have been going quite strong. Potazos, as you rightly said, we've expanded to other parts of the market, and we've been getting good response to the extension to these markets. Now one has to remember that this category is new to the market. It's a novel format. Therefore we'll really have to continue to commit to invest and grow and expand the adoption of this category. Therefore as a marketing unit, that's what we're really focused on. How do we create more trials, build more awareness for the format?
Just to, you know, give you a perspective, in organized trade we've actually seen a very quick ramp-up for Potazos, which is a great testament to the product. I mean, that's where the early adopter consumers are. Now, we just wanna continue to build our story on the differentiated cracker segment. That's where most of the growth in the category is coming. We've recently, after Potazos, launched another unique product called Biscafe. It's a coffee cracker and is being positioned as the perfect accompaniment to coffee. Now, if you look at the beverage consumption market in India, there are a lot of accompaniments to chai, but really none for coffee.
This we believe is going to be a really, really unique experience for consumers. Together, Potazos and Biscafe both will lay a foundation for a very, very new term in the category. That's on Potazos. Milk Bikis, we continue to expand in the rest of India. Now, if you look at some of the inflationary trends that Varun spoke about, combined with some of the challenges that we faced in a few Hindi markets, we've had a little bit of a plateau. Again, that's a short-term blip. The head space for growth is huge if you look at the low value-added glucose category. While there have been a few short-term blips, you know, in the longer term we don't see anything going away. We continue to invest to make sure that we upgrade consumers to a higher value-added product.
Coming to the CapEx, we've got three plants coming up this year. We've got the UP plant, we've got the expansion of Ranjangaon, expansion of Odisha, and we've got the Tamil Nadu plant coming up. There will be a reasonable investment in all of these, about INR 250 crore each. Two of these plants and the expansion will be approximately INR 100 crore, plus the finishing up of the dairy plant in Ranjangaon. The total CapEx, Venkat, is gonna be in the region of INR 650 crore-INR 700 crore this year?
Yeah, correct.
Okay, great. Just last question from my side. On dividend payout, have you finalized some policy? Because last two, three years we have seen extremely dividend payout. Any particular policy have you framed out on that front?
Venkat, you wanna comment?
Yeah. The policy is already in place. You know, there are various parameters that we put down there, and we also essentially say that we want to be in line with the other FMCG companies in the country.
Okay, thank you. Thanks.
Thank you. We would request participants to please limit your question to two at a time. Thank you. The next question is from the line of Manoj Menon from ICICI Securities. Please go ahead.
Hi, Varun, Venkat, and team. Hi. Just only one question, Varun. You know, just wanted to pick your brain on your thoughts about market share, let's say five years out from today. The context of asking this question is, you know, the way I understand, let's say you have somewhere close to 40% share, and you don't really want to have a bigger share in the glucose segment, which is possibly 30% or higher of the market.
If I take up 40%, which is your market share, and change the denominator from, let's say the addressable market, which the way you have defined it from, let's say 100 to 70, you probably have got little more than 60% market share in the relevant categories in which you want to play in. In that context, and please amend, you know, any of the numbers which I said, you know, which could be, you know, if it is materially incorrect. Just wanted to understand your thoughts on, you know, market share with a really medium- to long-term view, sir. Thank you.
Manoj, the way I look at it is very simple, right? Our market share in the urban markets is approximately 39%, right? Our market share in the rural markets is 27%, 28%. If we were to equalize our rural share to our urban share, we would get to that number that you're talking about. Now how do we equalize our urban share to our rural share? You're absolutely right. Glucose played a very important role in rural markets. In the last six, seven years, we've made inroads into that market with more premium products like Good Day 5 rupees, like Milk Bikis, like Marie. We will continue to do that. We are not breaking the market into segments. We are saying that this is consumption of a biscuit, whatever kind of biscuit it may be.
Consumers are always willing to make a leap of faith and try a biscuit which is different, which is more premium maybe, which they would stick to or not stick to. That is the way we are looking at the market. We will find ways of making sure that with—
Ladies and gentlemen, we lost the line for the management. Request you to continue to hold while we join them back. Ladies and gentlemen, thank you for patiently waiting. We have the line for the management reconnected. Over to you, sir.
Sorry, sorry, guys. Got disconnected. Can you hear me?
Yes, sir, we can hear you.
Okay. I was talking about market share, and that really is our objective. Objective is that we've got arsenal, we've got arsenal of brands, we've got arsenal of, you know, price points, products. We have to get to that with whatever we have in hand. Yes, there are products like Tiger Krunch, which we haven't taken to its limits, right? Tiger Krunch is in the value space doing extremely well, growing very high double digits. You know, very, very high double digits in areas where it is present. It's quite a bit like Milk Bikis, which is, you know, was only in the South and not in other places. Similarly, Krunch is in maybe four states and does extremely well. We've got to take it, we've got to make that a weapon. By the way, glucose is not 30%. Glucose is more like, what? 20%?
15%, 20%. 15%-odd .
It's about 18% now, so it's come down pretty dramatically from what it used to be. Okay? Madhuri, can you move on?
Mr. Menon? Are you-
Yeah, I'm good. I had only one question. Thank you so much.
Thank you. The next question is from the line of Alok Shah from Ambit Capital. Please go ahead.
Yeah, hi. Congrats on a good performance. My first question, Varun , are you seeing consumers, you know, moving from INR 5 rupee to INR 10 rupee price points because of grammage cuts? So essentially the question is the number of packs that you would have sold, say, a year back at INR 5 rupee and INR 10 rupee price point. Are you largely seeing any shift over there?
No, we haven't seen any shift like that. It depends on your laddering. If you're giving better value at INR 10 rupees, then consumers might shift. Our value is not dramatically different. The laddering on our value is maybe slightly better, but not good enough for people to move from INR 5 rupees to INR 10 rupees.
Would that be a strategy in the coming year, considering the inflation is the period where, you know, one would look at using that as a strategy? Just wanted to take your thoughts on that.
Could be, but you know, it's a huge leap. Consumers sometimes just have INR 5 rupees to spend. If we do not provide them that opportunity or we provide an opportunity which is suboptimal from a value standpoint, then they will move to some other products. The products that are available in the market are ranging from other food categories to, you know, certain snacks which are being freshly made at the outlet, to bakery biscuits which are, you know, available in open form, et cetera. We've got to be a little careful that we don't reverse this agenda of gaining from, you know, the bottom of the pyramid snacks.
Got it. My second question is on this roughly 4%-5% kind of a volume growth. Wanted to check, is this coming from, say, a larger share of Milk Bikis in South or is it largely coming from Hindi Belt ? If you can just give us one step more granular breakup into the regions or the products from where this volume growth is coming.
It's a little bit of a, you know, it's also the mix of the product categories that we have. Within biscuits, yes, it is because of, you know, we've been selling a lot of Tiger Krunch. Tiger Krunch, by the way, is not, you know, unprofitable segment like, some of the other value, you know, segments. It's a reasonably profitable SKU for us and a reasonably profitable brand for us. We've been growing like 30%, 35% on that. Milk Bikis has been a fairly good growth for us. All of those are adding to this. Plus, you know, our milk drinks have been doing really well. The Winkin' Cow, you know, has been doing very well for us. I think it's a little bit of product mix and a little bit of, you know, mix between our categories.
Got it. As this adjacencies will scale up, you know, which will mean that this volume growth per se could be little higher. You know, maybe now it would be premature, but going ahead, would you like to give a split of biscuit volume and the adjacent revenue? Something of that sort. Is that the thought process?
Yeah, no, it's possible. You know, once the adjacency businesses get to a certain scale, we'd love to do that.
Sure. My last and final quick question is, you know, to my reckoning, for the first time you mentioned with respect to the new team for the adjacent business. Is that a complete change in the team or reporting structure or any of those lines you can share? Thank you.
No, that's a good question. What we've done is we have tried to make our— it's a change in structure. We've got young leaders who are very aggressive, and we've got different verticals. Actually, that's a good point. Maybe in the next meeting with all of you, I should share that on how we are structured, or maybe I did share it with you last time. We've got verticals. Obviously, biscuits is one. We've got cake, rusk, and bread as another vertical. We've got dairy as the third vertical, and we've got new businesses, which is, you know, croissant, wafers, and all of the new businesses that we are looking at to be the fourth vertical. We've got very solid young leaders who are very deeply ingrained into their businesses.
What we've tried to do is we've tried to create an agile structure so that decision-making is not like a large organization that Britannia is, but they can take some quick and dirty decisions whenever necessary. You know, we don't suffer the reasons for a large company not being agile. We want these guys to operate like startups, and that's really helping us. First, the quality of people, and second, the teams that we've set up under them, and third, the agile structure. All three of them are helping us.
Got it. Considering the paucity of time, maybe I will not ask a follow-on, but you'd like to, I mean, you know, maybe in the next quarter understand much more on their compensation structure, you know, their ESOP or something of that sort to get more comfort on that. Thank you.
Thank you. Ladies and gentlemen, due to time constraints, it was the last question for today. I now hand the conference over to the management for closing comments.
Thanks, everyone, for spending time with us on this call. We look forward to interacting with you again. Thank you.
Thank you. On behalf of Britannia Industries Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.