Overview :

The total production of biscuits in India is estimated to be around 30 lakh MT, the organized sector accounts for 65% and the unorganized sector accounts for 35% of the total industry volume. The organized sector is valued at above Rs 8000 crores. The biscuit industry is estimated to grow over 15-17% in the next few years. The per capita consumption of biscuits in India is 2.0 kg. India is ranked 3rd after US and China amongst the global biscuits producers. The export of biscuits is approximately 17% of the annual production, the export of sweet biscuits for year 2007-08 was Rs 145.93 Cr and for year 2008-09(April-Dec) was Rs 280 Cr, the major exporting regions were Haiti, Angola, USA, Ghana, UAE.

The imports are not significant amount as compared to the total consumption. The penetration of biscuits in urban and rural market is 85% and 55% respectively. The Biscuit industry employs almost 3.5 lakh people directly and 30 lakh people indirectly.

The organized biscuit manufacturing industries annual production Year 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 12.54 14.29 16.14 17.14 19.5

Annual Production(Lakh MT) 11.00

Main Categories of Biscuits : Glucose, Marie, Sweet, Salty, Cream & Milk. Glucose biscuits accounts for more than 50% of the total biscuit market value, Parle G dominate this market with more than 60% share followed by Britannia and ITC.

Brands :Major brands The Indian biscuit industry is dominated by major brands like Parle, Britannia, and Sunfeast. Also the category has strong regional brands such as Priya Gold-North, Cremica-North & West, Dukes-South and Anmol-East & North. Other popular brands Horlicks, Biskfarm-East, Rose-Andhra Pradesh & South, Sobisco-East and North East also launched in Andhra Pradesh and Madhya Pradesh., Nezone- North East, Bakewell. Market Share Breakdown The Indian biscuit industry is dominated by brands like Parle, Britannia and Sunfeast.

Consumption Pattern across Various Regions Consumption of biscuits is even across the regions

2009 New Prospects in the Indian Biscuit Industry

GlaxoSmithKline Consumer Healthcare: Junior Horlicks Biscuits-toddler biscuit category. PepsiCo India Launched biscuit brand Aliva, it will be produced by food division Frito Lay India. United Biscuits (UK), worlds third largest biscuit company, is set to enter India market. Shakti Bhog plans to enter biscuits segment.

Major Players

Britannia Industries Ltd. : Net sales for FY 2008-09 are Rs 3,112.2 Cr. For FY 07-08 biscuits recorded sales of Rs. 2,329.9 Cr.

Key Products Tiger, Good Day, Bourbon, 50-50, Treat, Milk Bikis, Marie Gold, NutriChoice, Timepass, Little Hearts

Parle Products Pvt. Ltd : Established In 1929, company has factories in Mumbai, Bangalore, Bahadurgarh in Haryana and Neemrana in Rajasthan, Additionally, Parle Products also has 7 manufacturing units and 51 manufacturing units on contract. Company has about approximate market share of 30-35% of the total biscuit market. Parle-G accounts for the major volume turnover it accounts for approximately 80% of the total biscuit tonnage for the company. Key Products : Parle - G , Hide and Seek ,Krackjack ,Hide & Seek Milano ,Magix ,Digestive Marie ,Monaco ,Parle Marie ,Kreams ,Milk Shakti ,Parle 20-20 Cookies ,Golden arcs ,Nimkin ,Kreams Gold ,Chox ,Monaco Jeera

Surya Food & Agro Ltd : Manufacturing & selling of biscuits under brand Priyagold. Company has three plants located in Greater Noida, Lucknow & Surat. They also outsource some of our requirements to another plant located in Hyderabad. Capacities have reached 1, 50,000 MT p.a. Key Products : Classic Cream , Butter Bite ,Kids Cream ,Bourbon ,Big Boss ,Marie Lite ,Magic Gold ,CNC ,Cheese Cracker ,Snacks Zig Zag ,Don ,Coconut Crunch ,Cheez Bit Classic Salt ,Chatpata

ITC Ltd : In July 2003, ITC forayed into the Biscuits market with the Sunfeast range of Glucose, Marie and Cream Biscuits. Sunfeast with a current market share of ~10% is now clearly established as a credible third brand. Key Products : Sunfeast Milky Magic ,Sunfeast Marie Light ,Sunfeast Golden Bakery ,Sunfeast Dark Fantasy ,Sunfeast Dream Cream ,Sunfeast Snacky ,Sunfeast sweet 'n salt ,Sunfeast Nice ,Sunfeast Benne Vita Flaxseed Biscuits ,Sunfeast Special

Anmol Biscuits Ltd : Anmol is a popular brand of eastern & northern region, having manufacturing facilities in W.B & U.P. Key Products : Lemon Mazaa , Funfill Choco Vanilla , Yummy - Milk Cream , Tip Top Kajoo Kurkure Masala, Coconutty , Thin Arrowroot , Marie,2 in 1, Butter Bake , Cream Cracker , Dil Khush , Dream Lite , E-Time , Funfill Orange , Funfill Rich Chocolate ,Golmol ,Jadoo ,Marie Time , Snackles ,Milk Made

BISCUIT INDUSTRY OVERVIEW

Biscuits Industry in India is the largest among all the food industries and has a turnover of around Rs.3000 crores. India is known to be the second largest manufacturer of biscuits, the first being USA. It is divided into 2 sectors, the organized and unorganized. The organized sector contributes to 55% of the total production and the remaining 45% comes from the unorganized sector. The industry consists of two large scale manufacturers, around 50 medium scale brands and small scale units ranging up to 2500 units in the country. The unorganized sector is estimated to have approximately 30,000 small & tiny bakeries across the country. Indias Biscuits Industry came into the limelight and started gaining a respectable status in the bakery industry in the later part of 20th century. This was a result of a demand coming for the urbanized society for ready-made food products at an affordable price. States that have the larger intake of biscuits are Maharashtra, West Bengal, Andhra Pradesh, Karnataka, and Uttar Pradesh. Maharashtra and West Bengal, the most industrially developed states, hold the maximum amount of consumption of biscuits. The rural sector consumes around 55 percent of the biscuits in the bakery products. The growth of the biscuit industry in India has been slow, and it has been calculated to be growing at the rate of 13% per annum. Due to the heavy VAT of 12.5% and excise duty of 8% imposed of biscuit manufacturers, the per capita consumption of biscuits in India is only 1.9 kg compared to 10 kg in the USA, UK and West European countries and above 4.2 kg in the South East Asian countries like Singapore, Hong Kong, Thailand, and Indonesia. One of the major reasons for the stagnant growth of the biscuit industry is the tax laws and excise duties. While commodities like tea, coffee, namkeen are exempted completely from excise duty

and have VAT of only 4%; biscuits have to suffer with higher numbers. As a result of which they cannot lower their costs to increase profit margins. At the national level, there are only two players Parle and Britannia. Therefore, one can say that they are operating in a duopoly market. But on the lower levels, where the regional players like Priya Gold, bakeman etc come in, they have to operate in a perfectly competitive market. The state markets have their own dynamics in comparison to the national markets. These players have to implement different strategies in the different market scenarios to face competition and remain dominating players.
India Biscuits Industry came into major existence and started gaining a sound status in the bakery industry in the later part of 20th century when the urbanized society called for ready made food products at a tenable cost. Biscuits were assumed as sick-man's diet in earlier days. But today it has become one of the most loved fast food products for every age group. Biscuits are always easy to carry, tasty to eat, cholesterol free and reasonable at cost. States that have the larger intake of biscuits are Maharashtra, West Bengal, Andhra Pradesh, Karnataka, and Uttar Pradesh. Maharashtra and West Bengal are the most industrially developed states; hold the maximum amount of consumption of biscuits. Even, the rural sector consumes around 55 % of the biscuits in the bakery products.

Indian Biscuits Industry seems to be the largest among all the food industries and has a turnover of around Rs.3000 crores. Indian subcontinent is known to be the second largest manufacturer of biscuits, the first being USA. The industry is classified under two sectors: organized and unorganized. Bread and biscuits are the major part of the bakery industry and covers around 80 % of the total bakery products in India. Biscuits today stand at a higher value and production level than bread. This belongs to the unorganized sector of the bakery Industry and covers over 70% of the total production. In the year 1990 the total production of bakery products have risen from 5.19 lakh tonnes in 1975 to 18.95 lakh tonnes. Today Biscuits contributes to over 33 % of the total production of bakery and above 79 % of the biscuits are manufactured by the small scale sector of bakery industry comprising both factory and non-factory units in the country. The production capacity of wafer biscuits is 60 MT and the cost is Rs.56, 78,400 with a motive power of 25 K.W. Indian biscuit industry has occupied around 55-60 % of the entire bakery production. Today the large scale bakery manufacturers like Cadbury, Nestle, and Brooke bond had traded in the biscuit industry but couldn't hit the market

because of the local companies that produced only biscuits. Government has established The Federation of Biscuit Manufacturers of India (FBMI) which has confirmed a bright future of India Biscuits Industry in the year 1953. According to FBMI, a steady growth of 15 % per annum in the next 10 years will be achieved by the biscuit industry of India. Besides, the export of biscuits will also surpass the target and hit the global market successfully.

Brief introduction Today the total production of biscuits in India is estimated to be around 30 lakh MT, the organized sector accounts for 65% and the unorganized sector accounts for 35% of the total industry volume and the organized sector is valued at above Rs 8000 crores. While the the biscuit industry is estimated to grow over 15-17% in the next few years. The biscuits per capita consumption in India is 2.0 kg. India is ranked 3rd after US and China amongst the global biscuits producers. The export of biscuits is approximately 17% of the annual production, the export of sweet biscuits for year 2007-08 was Rs 145.93 Cr and for year 2008-09(AprilDec) was Rs 280 Cr, the major exporting regions were Haiti, Angola, USA, Ghana, UAE. The imports are not significant amount as compared to the total consumption.
The penetration of biscuits in India among the urban and rural market is 85% and 55% respectively. The annual turnover for the organized sector of the biscuit manufacturers at 2001-02 is Rs. 4,350 crores. The annual Growth showed a decline of 3.5% in 2000-01, mainly due to 100% hike in Central Excise Duty (from 9% to 16%) by the government. Production in the year 2001-02 increased very marginally by 2.75% where in 2002-03 the growth is around 3%. Government took initiatitive for the development as The Union Budget for 2003-04 granted 50% reduction in the rate of Excise Duty on Biscuit i.e. from 16% to 8%. The Federation's estimate indicates a growth of approximately 8% to 9% per year. Biscuit is always hygienically packaged nutritious snack food available at very competitive prices, volumes and different tastes. According to the NCAER analysis, biscuits are predominantly consumed by people from the lower strata of society, particularly children in both rural and urban areas with an average monthly income of Rs. 750and above. The organized biscuit manufacturing industries annual production

Year Annual Production(Lakh MT)

2003- 2004- 2005- 2006- 2007- 200804 05 06 07 08 09 11.00 12.54 14.29 16.14 17.14 19.5

Market capitalization
India Biscuits Industry is the largest among all the food industries and has a turnover of around Rs.4350 crores.

Size of the industry

The production capacity of wafer biscuits is 60 MT and the cost is Rs.56, 78,400 with a motive power of 25 K.W. Indian biscuit industry has occupied around 55-60 % of the entire bakery production. The Indian Biscuit industry for the organized sector produces around 60% of the total production, the balance 40% being contributed by the unorganized bakeries. The industry consists of two large scale manufacturers, around 50 medium scale brands and small scale units ranging up to 2500 units in the country, as at 2000-01. The unorganized sector is estimated to approximately have 30,000 small & tiny bakeries across the country.

Total contribution to the economy/ sales

Biscuit industry contribute Rs 8,000 crore to the FMCG industry today, provides vast opportunity for growth, as the per capita consumption of biscuits is less than 2.1 kg in our country. India is classified under two sectors: organized and unorganized. Branded /Organized to Unbranded/Un organized market share of biscuit has been 70% for Organized sector and 30% for Unorganized sector. Apart from Big 3(Britannia, Parle, ITC) there are around 150 medium to small biscuit factory in India.

Top leading Companiess

Parle Britannia Sunfeast Priya Gold Cremica Dukes Anmol Horlicks Biskfarm Rose Sobisco Nezone

Employment opportunities
The Biscuit industry employs almost 3.5 lakh people directly and 30 lakh people indirectly. Brittania brand is now available in nearly 1.8 million outlets. Britannia claims that it has a superior distribution

clout with its presence which is nearly 3.3 million outlets. Parle, the seasoned player itself, says it is available in 1.5 million outlets. Sunfeasts next step was to step up its branding and promotion.

Latest developments

Indian biscuit market is 1.1 million tonnes per annum at Rs 50 billion. About 90% of Indians buy and eat biscuits. According to estimates the bakery industry in India is worth Rs 69 billion. Out of which bread and biscuits hold about 82% of the share. The bread market has a business volume of 1.5 million tonnes. The major factors for growth in this segment are: Brand loyalty, volumes and strong distribution networks. Growth in the over 40-year-old Indian biscuit industry has remained slow. The analysts calculations will show that per capita consumption is less than Rs 3 per month on biscuits or less than Rs 15 per household per month. Back in 2003, nobody thought Sunfeast would have consumers eating out of its hands. According to the AC Nielsen retail sales audit in March 2006, both Britannia and Parle have lost volumes. Britannia's shares have dropped from 35.8 % in 2004-05 to 30.5 % in May 2006 (volumes). Parle's shares have also dropped from 42.2 to 38.4 % in the same period. Even Priya Gold has seen a minor dip from 6.4 % to 5 %. ITC's Sunfeast has been a big gainer with its share increasing from 2.7 to 6.7 %.