Britannia Industries Limited, a leading FMCG company, stated in its annual report for 2022-23 that the food sector, in which it operates, has been substantially affected by soaring commodity prices and increasing interest rates. Moreover, the fallout of the Russia-Ukraine conflict has also contributed to these challenges. The company highlighted that the enduring repercussions of these factors continue to have a significant impact on the industry.

It said that although commodity prices were volatile and inflation was at unprecedented levels, the post-Covid normalisation of economic activities supported growth throughout 2022-23.

During the last fiscal, the major challenge confronting the food industry was managing inflation in the cost of key inputs like wheat, milk, sugar, palm oil and crude oil, the company annual report said.

The foods vertical of Britannia comprise segments like biscuits, cakes, rusks, bread and dairy.

On the outlook for the foods vertical, the company said that businesses in the country are still optimistic on demand conditions despite apprehensions about global recession.

The inflation trajectory during the coming year will depend on a host of domestic and global factors. The outlook for food prices and rural growth will depend significantly on the climate and adequacy of monsoon rain, it said.

Britannia said that the company’s international business weathered the difficult inflationary environment and expanded to new geographies during 2022-23.

The company’s strategy in its international business is to strengthen brand equity, offer new products, establish and grow local operations in fast emerging markets like contract manufacturing, acquisitions and joint ventures.

The international business of Britannia is primarily focussed in the countries of the Middle East, America, Africa, Asia Pacific and SAARC.