Britannia Industries

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Britannia Industries Limited
Britannia Biscuit Company Limited
Traded as BSE:  500825
Industry Food processing
Founded1892;128 years ago (1892) in Calcutta
1918;102 years ago (1918) as Britannia Biscuit Company Limited
Area served
Key people
Nusli Wadia (Chairman)
Products Bakery products, including biscuits, bread, cakes and rusk, and dairy products, including milk, butter, cheese, ghee and dahi
RevenueIncrease2.svg8,684.39 crore (US$1.2 billion) (2017) [1]
Increase2.svg1,251.16 crore (US$180 million) (2017) [1]
Increase2.svg843.69 crore (US$120 million) (2017) [1]
Total assets Increase2.svg3,696.14 crore (US$520 million) (2017) [1]
Number of employees
3,206 (as on 31 March 2017) [1]
Parent Wadia Group

Britannia Industries Limited is an Indian food-products corporation. Founded in 1892 and headquartered in Kolkata, it is one of India's oldest existing companies. It is now part of the Wadia Group headed by Nusli Wadia. The company sells its Britannia and Tiger brands of biscuits, breads and dairy products throughout India and in more than 60 countries across the world. [2] Beginning with the circumstances of its takeover by the Wadia group in the early 1990s, the company has been mired in several controversies connected to its management. However, it enjoys a large market share and is exceedingly profitable.



The company was established in 1892 by a group of British businessmen with an investment of 295. [2] Initially, biscuits were manufactured in a small house in central Kolkata. Later, the enterprise was acquired by the Gupta brothers, mainly Nalin Chandra Gupta, an attorney, and operated under the name "V.S. Brothers." In 1918, C.H. Holmes, an English businessman based in Kolkata, was taken on as a partner and The Britannia Biscuit Company Limited (BBCo) was launched. The Mumbai factory was set up in 1924 and Peek Freans UK, acquired a controlling interest in BBCo. Biscuits were in high demand during World War II, which gave a boost to the company’s sales. The company name was changed to the current "Britannia Industries Limited" in 1979. In 1982, the American company Nabisco Brands, Inc. acquired the parent of Peek Freans and became a major foreign shareholder.

A few years later, control moved through a complicated process, which is still not fully understood, to Rajan Pillai, a Kerala-based businessman and a crony of Nusli Wadia. The two cronies fell out with each other and an uproarious corporate drama unfolded. It ended after the death of Rajan Pillai in police custody and the confirmed takeover of control by Nusli Wadia. Its subsequent corporate history has also had a full share of controversies.


Britannia Little Hearts Britannia Little Hearts.jpg
Britannia Little Hearts

The company's principal activity is the manufacture and sale of biscuits, bread, rusk, cakes and dairy products.


Biscuits account for 90% of Britannia's annual revenue. The company's factories have an annual capacity of 433,000 tonnes. [3] The brand names of Britannia's biscuits include VitaMarieGold , Tiger, Nutrichoice, Good day, 50 50, Treat, Pure Magic, Milk Bikis, Bourbon, Nice Time and Little Hearts among others.

In 2006, Tiger, the mass market brand, realised $150.75 million in sales, including exports to the U.S. and Australia. This amounts to 20% of Britannia revenues for that year.

Also Britannia Industries has roped in Bollywood actor Salman Khan to endorse it range of 'Tiger' brand of biscuits. According to Britannia, Khan will play a role in further enhancing Tiger’s core values through his association in presenting the brand, its products and promotional activities.

Dairy products

Dairy products contribute close to 10% to Britannia's revenue. [4] The company not only markets dairy products to the public but also trades dairy commodities business-to-business. Its dairy portfolio grew to 47% in 2000-01 and by 30% in 2001-02. Its main competitors are Nestlé India, the National Dairy Development Board (NDDB), and Amul (GCMMF). [5]

Britannia holds an equity stake in Dynamix Dairy and outsources the bulk of its dairy products from its associate.

On 27 October 2001, Britannia announced a joint venture with Fonterra Co-operative Group of New Zealand, an integrated dairy company which handles all aspects of the value chain from procurement of milk to making value-added products such as cheese and buttermilk. [5] Britannia intends to source most of the products from New Zealand, which they would market in India. [4] The joint venture will allow technology transfer to Britannia. [5] Britannia and New Zealand Dairy each hold 49% of the JV, and the remaining 2 percent will be held by a strategic investor. Britannia has also tentatively announced that its dairy business (probably including Dynamix) would be transferred to the joint venture. [5] However, the authorities' approval to the joint venture obliged the company to start manufacturing facilities of its own. It would not be allowed to trade, except at the wholesale level, thus pitching it in competition with Danone, which had recently established its own dairy business. [5]

Performance and profitability

Between 1998 and 2001, the company's sales grew at a compound annual rate of 16% against the market, and operating profits reached 18%.[ citation needed ] More recently, the company has been growing at 27% a year, compared to the industry's growth rate of 20%.[ citation needed ] At present, 90% of Britannia's annual revenue of Rs 22 billion comes from biscuits.

Britannia is one of India's 100 Most Trusted brands listed in The Brand Trust Report . [6] Britannia has an estimated market share of 38%. [3]

Disputes and controversies

Wadia and Rajan Pillai

Kerala businessman Rajan Pillai secured control of the group in the late 1980s, becoming known in India as the 'Biscuit Raja'. [7] In 1993, the Wadia Group acquired a stake in Associated Biscuits International (ABIL), and became an equal partner with Groupe Danone in Britannia Industries Limited.

In what The Economic Times referred to as one of [India's] most dramatic corporate sagas, [8] Pillai ceded control to Wadia and Danone after a bitter boardroom struggle, [9] then fled his Singapore base to India in 1995 after accusations of defrauding Britannia, and died the same year in Tihar Jail. [10]

Wadia and Danone

The Wadias' Kalabakan Investments and Group Danone had two equal joint venture companies, Wadia BSN and United Kingdom registered Associated Biscuits International Holdings Ltd., which together held a 51 percent stake in Britannia. [11] The ABIH tranche was acquired in 1992, while the controlling stake held by Wadia BSN was acquired in 1995. It was agreed that, in case of a deadlock between the partners, Danone was obliged to buy the Wadia BSN stake at a "fair market value". ABIH had a separate agreement signed in 1992 and was subject to British law. [11] [12]

Wadia was to be Danone's wife's partner in the food and dairy business, and product launches from Groupe Danone's were expected but never materialised despite the JV being in existence for over 11 years in India. [11] Under the 1995 joint venture agreement, Danone is prohibited from launching food brands within India without the consent of the Wadias. [13] In addition, the partners agreed there would be the right of first refusal to buy out the remaining partner in the event of the other wishing to sell its holding. [14]

In June 2006, Wadia claimed Danone had used the Tiger brand to launch biscuits in Bangalore. [14] In May 2007, Nusli Wadia told the Ministry of Commerce and Industry that Danone invested in a Bangalore-based bio nutrition company, Avesthagen, in October 2006 in violation of the government's Press Note 1, 2005, which requires a foreign company to obtain the consent of its Indian joint venture partner before pursuing an independent business in a similar area, including joint ventures based purely on technical collaboration. Danone argued that Press Note 1 did not apply to it as it did not have a formal technology transfer or trademark agreement with Avesthagen, and that its 25% holding in Britannia was indirect. [15] Wadia also filed a case in the Bombay High Court for a breach of a non-competition clause in that connection. The court ordered Danone not to alienate, encumber or sell shares of Avesthagen. [16]

In September 2007, the Foreign Investment Promotion Board of India rejected Danone's claims that it did not need a non-compete waiver from the Wadias to enter into business in India alone. [17]

After a prolonged legal battle, Danone agreed to sell its 25.48% stake in Britannia to Leila Lands, which is a Wadia group entity based in Mauritius, and quit this line of business. The deal was valued at $175–200 mn. With this buy-out, Wadia holds a majority stake of 50.96%. [18]

Intellectual property dispute

In a separate dispute from the shareholder matters, the company alleged in 2006 that Danone had violated its intellectual property rights in the Tiger brand by registering and using Tiger in several countries without its consent. Britannia claimed the company found out that Danone had launched the Tiger brand in Indonesia in 1998, and later in Malaysia, Singapore, Pakistan and Egypt, when it attempted to register the Tiger trademark in some of these countries in 2004. [19] Whilst it was initially reported in December 2006 that agreement had been reached, [20] it was reported in September 2007 that a solution remained elusive. [19] In the meantime since Danone's biscuit business has been taken over by Kraft, the Tiger brand of biscuits in Malaysia was renamed Kraft Tiger Biscuits in September 2008.

Britannia initiated legal action against Danone in Singapore in September 2007. [21] The dispute was resolved in 2009 with Britannia securing rights to the Tiger brand worldwide, and Danone paying Rs220 million to utilise the brand. [22]


See also

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  1. 1 2 3 4 5 "Annual Report 2016-17" (PDF). Britannia Industries Limited. 30 October 2017. Retrieved 30 October 2017.
  2. 1 2 Company Overview Britannia Industries
  3. 1 2 Ruchita Saxena,Battle-scarred Britannia on expansion spree, Business Standard, 6 October 2007
  4. 1 2 Abhrajit Gangopadhyay, Danone move may hit Britannia's dairy plans, Hindu Business Line, 7 January 2002
  5. 1 2 3 4 5 Aarati Krishnan, Britannia Industries: Pare exposures, Hindu Business Line, 3 Feb 2002
  6. "All India Brand Trust Ranking". The Brand Trust Report . Trust Research Advisory. Archived from the original on 18 February 2012. Retrieved 27 February 2012. 67: Britannia
  7. "Rajan Pillai death: Advani rejects probe plea". Archived from the original on 11 November 2013. Retrieved 27 February 2012.
  8. "Pillai's brother eyes global JV for biscuits pie". The Economic Times . 12 February 2007. Archived from the original on 21 January 2012. Retrieved 7 February 2012.
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  11. 1 2 3 Dev Chatterjee, Danone takes arbitration route to end Wadia ties, Business Standard , 1 July 2007. Retrieved 27 February 2012.
  12. Kala Vijayraghavan, ABIL joins Britannia-Group Danone battle, The Economic Times , 21 November 2006
  13. Ruth David, Danone's Indian Cookie JV Set To Snap, Forbes, 25 June 2007
  14. 1 2 "Danone may dissolve ties with Britannia". Business Standard. IRIS News Digest. 21 June 2007. Archived from the original on 20 July 2011. Retrieved 27 February 2012.
  15. Danone denies JV with India's Britannia; to proceed with solo plans - report, Thomson Financial, 25 May 2007
  16. Wadias take Danone to court, 5 December 2006
  17. Danone needs NOC from Wadias: FIPB, 28 September 2007
  18. Danone to sell Britannia stake, 7 April 2009
  19. 1 2 Ruth David (20 September 2007). "Indian Cookie Maker Taking Danone To Court". Forbes. Archived from the original on 25 November 2007. Retrieved 27 February 2012.
  20. Danone to return 'Tiger' to Britannia, Knight-Ridder Tribune Business News, 4 December 2006
  21. "Britannia sues Danone in S'pore". Deccan Herald. 21 September 2007. Archived from the original on 13 December 2007. Retrieved 27 February 2012.
  22. Britannia surges on Danone dispute settlement, Economics Times, 1 September 2009