Britannia CEO doubts Reliance's biscuit play

Britannia Industries believes that Reliance Industries will find it difficult to replicate the price-disruption it caused in the cola market in its just-entered core biscuits industry given the different pricing dynamics of the segment.

"As far as Reliance is concerned, we have to study what they have done. So they have come with a range of products, basically very similar to all the classical products in the market. And they are starting with Tamil Nadu. Tamil Nadu is a large state for biscuits also for us, as you would know," said Britannia Industries CEO & MD Rakshit Hargave in an analyst call on Saturday.

However, he pointed out that the biscuits market operates differently from the cola segment, where aggressive pricing and discounts helped Reliance create disruption.

Reliance's Campa is competing with market leaders as Coca-Cola and PepsiCo and has achieved double-digit share in key markets. Earlier this month, Reliance Consumer Products Ltd entered into the biscuits market through its in-house brand Independence. It has launched 28 new stock-keeping units (SKUs) in Tamil Nadu with plans to scale pan India.

"The disruption of price, which happened in the cola market. As you would know, in the biscuit market, a large part of the market operates at Rs 5 and Rs 10. So the ability to disrupt those 2 price points in the biscuit market is much more difficult than you can do in a cola market by discounting by Rs 5 or Rs 10," Hargave added.

Describing Mukesh Ambani-led Reliance as a "very respectable competition", Hargave said Britannia will closely watch how the competitive landscape evolves.

He, however, expressed confidence in the company's competitive strengths, saying Britannia has strong market moats and well-defined plans to sustain its growth.

"We also have very, very strong moats and very strong plans to go ahead, and we will see what and how it transpires," he added.

Reliance had entered into the fast-growing beverage market in August 2022 after acquiring Campa Cola, which delivered Rs 2,900 crore in Q1 sales, contributing almost one-third of the topline of RCPL. It almost delivered "50 per cent of FY26 sales in Q1," said RIL in its earnings presentation.

The company plans to launch Campa in the aluminium can versions by the end of this month.

It has already launched Campa cans in the Australian market, through Goodness Group, a company which was acquired by the Reliance group in February this year.