Packaged food and snacking brand, Bikano, is eyeing a turnover of ₹1,250 crore in FY22, banking on increased demand and a foray into new markets like the south apart from higher penetration in existing markets.

Bikano, based-out of Delhi, is a strong player in the snacks and namkeen segment across north Indian markets.

Production facilities

The company is looking at strengthening its production facilities with a ₹100 crore capex in a two-to-three year period, which include an upcoming one at Hyderabad, to cater to the south and west Indian markets. The Hyderabad facility, with a capacity of 3,000 million tonnes (MT) per month – is expected to be on-stream by December-end and will add ₹10 crore to their top-line by FY22.

Also see: Sweets and snacks now ‘heavy on the pocket’

“Expansion plans will be funded through internal accruals as of now,” said Pankaj Agarwal, COO, Bikano, adding, “There are no plans of an IPO currently but it might be explored at a later stage.”

Bikano currently has five facilities, all in North India, with a combined production capacity of 12,000 MT per month.

Strong growth

The company reported a turnover of ₹1,000 crore in FY21, a 20 per cent growth YoY. It competes with Haldirams, Pepsico’s Kurkure and Lay’s, and Prataap snacks on a national level in the branded snacks and namkeen categories.

According to Agarwal, Bikano saw a nearly 50 per cent jump in sales in Q1FY21, led primarily by pantry-loading and its ability to continue with supplies to the market. Although there has been some tapering-off, “high double digit growth” is still possible.

“There has not been much pantry loading in wave 2 and supply to stores was not disrupted either. However, demand patterns are shifting towards branded offerings now. So the snacking segment, which is dominated by unorganised and local players, is now witnessing a shift towards branded packaged food, ready to eat and trusted brands,” Agarwal said.

Margin pressure

Despite margin pressure due to a rise in raw material and packaging item prices, increasing edible oil cost, and a hike in fuel charges, the company has “held on to price points” specially in the convenience spots of ₹10, ₹20 and ₹50.

“We are hopeful of price correction on the raw material and edible oil front post monsoons, thereby giving us some relief,” Agarwal said.

E-commerce sales, mostly large packs, are witnessing a 30-40 per cent growth month-on-month, albeit over a low base.

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