In order to combat growing inflation, Britannia Industries will adopt bigger grammage cuts rather than raising prices. In the fiscal year 2021-22 (FY22), the biscuit giant raised prices by 10% and reduced pack sizes as an indirect way of raising prices. The grammage reduction ratio was 65% in the previous fiscal year, and it will be greater in FY23.
If raw material prices remain at present levels, the management announced it would raise prices by 10%.
“There have been geopolitical factors which are aggravating the inflation scenario, and I don’t think that it’s abating in any way… Because of our forward commitments, we have been able to control some of our costs. However, the commodities have still witnessed inflation of 17 percent and 14 percent for the quarter and full-year respectively,” Varun Berry, managing director of Britannia Industries, informed investors in a conference call.