Britannia Industries Ltd. on Monday announced a proposal to issue non-convertible debentures as bonus debentures at ₹60 each in the ratio of one debenture for every share held.
The board will also consider a sub-division of stocks later. BIL also unveiled a new logo to mark its centenary year.
A bonus debenture is issued at no cost to shareholders and will help the holders earn interest. Since these are not convertible, in this instance, the principal amount accrues to the holder at the end of the tenure.
Addressing shareholders at the company’s 99 AGM, chairman Nusli N. Wadia said the board approved the debenture proposal on Monday and the company was now in a position to look at acquisitions and expansion into new geographies and areas. “We have plans, but I cannot share them now,” he said.
Pointing out that its R&D Centre would play a critical role in Britannia’s future, he said that a large number of products marking 100 years of Britannia would be rolled out over the next six months.
Managing Director Varun Berry said that focussed advertising (of the pillar brands) and increase in the number of distributors from 6 lakh to 19 lakh had boosted the topline, which was also aided by robust innovations.
A sum of ₹800 crore had been saved through cost reductions during this period. “BIL is now the no. 1 player in the biscuit market, way ahead of Parle,” he said.
The shareholders also approved a proposal to appoint Mr. Berry for a five-year term till March 2024. The company’s board appointed him as MD in March 2014 for three years till March 2019.
Wadia to continue
A special resolution was also moved to continue the directorship of Mr. Wadia and A.K. Hirjee, who will turn 75 in April 2019.
The company said that a proposal on stock split would be considered by the board at its meeting on August 23.
BIL closed the first quarter with a 19.1% rise in net profit at ₹258.1 crore, while total income rose to ₹2,582.8 crore from ₹2,581.9 crore a year earlier, according to a regulatory filing.
Mr. Wadia also said that BIL was exploring a possible shift of its proposed ₹300-crore dairy project from Maharashtra.
“We have waited for one year for the Maharashtra government to grant fiscal incentives to us. This is too long,” he said after the AGM. “We have had discussions with Andhra Pradesh in this regard,” he added.
(With PTI inputs)
