Cadbury’s

Priyanka Ghosh
Roll No. 66
 SWEET PAST
Cadbury factory set up in India in 1947-- Cadbury has
been synonymous with chocolates.

John Cadbury ventured in the chocolate business in

England way in 1824.
Ingredients used :
-Cocoa mass, cocoa butter and cocoa sugars
mixed in a coarse dry mass.
-Competition from France and Switzerland forced
Cadbury experts to incorporate fresh milk in the recipe.
Resulted in Dairy Milk then known as “Dairy Maid”.
 BACKGROUND
 Originally incorporated as a wholly owned
subsidiary of Cadbury Schweppes Overseas Ltd
(CSOL) in 1948.
 The company’s original name was Cadbury Fry
(India) Ltd.
 Changed to Hindustan Cocoa Products in 1982
 The current name was restored in Dec ’89.
 In 1986, Cadbury forayed into biscuits with
Cadbury Butter, Glucose and Bournvita brands.
 In 1989, Cadbury diversified into ice creams with
Dollops and Lopstop brands.
 GROUP

 Cadbury Schweppes is one of the

leading global companies in beverages
and confectionery businesses. It has
operations in over 190 countries.
 Its leading global brands are :
-Beverages - Crush, Dr Pepper,
Indian Tonic Water, Canada Dry, Crystal
Light.
-Confectionery/ chocolate - Dairy
Milk, Mr Big, Timeout, Twirl, Perk, Sour
Patch, Hazel Nut.
 PLANT LOCATIONS

 1946 – Cadbury’s manufacturing operations

started in Mumbai.
 1964 – Induri farm at Talegaon, near Pune, set
up to promote modern methods as well as
improve milk yield.
 1977 – Company took steps to promote higher
production of milk by setting up a subsidiary
near Induri Farm Ltd. near Pune.
 1981-82 – A new chocolate manufacturing unit
setup in the same location in Talegaon.
 1989 – The company setup a new plant in
Malanpur, M.P, to derive benefits available to
the backward area.
 1995 – Cadbury expanded Malanpur plant.
EXECUTIVE SUMMARY
 CADBURY
 A dominating player in the Indian
chocolate market.
 Has strong brands like Dairy Milk, Five
Star, Perk, Gems etc, Dairy milk being
the largest chocolate brand in India.
 Chocolates & Confectionery contribute
to 75% of Cadbury’s turnover.
 Bournvita (malted health drink)
accounts for 24% of turnover.
CHOCOLATES AND CONFECTIONERY
PRODUCTS (75% of turnover)
 'Cadbury’ has become a generic name for chocolate
products.
 Cadbury has leading brands in all the segments viz
 bars (Dairy Milk, Crackle, Temptations),
 count lines (5 star, Milk Treat),
 panned confectionery (Gems)
 wafer chocolates (Perk),
 eclairs (Cadburys' Eclairs),
 toffees (English Toffee).
 Dairy Milk contributes an estimated 30% to Cadbury’s sales.
 New brand initiatives : Temptations in the premium segment
and Chocki a low priced chocolate confectionery targeted
at children.
 Launched Googly in 1996. In 1997, the company launched
a coffee based sugar confectionery product Mocka.
 Eclairs was relaunched with unique packaging in cartons
during 2001.
 FOOD DRINKS (25% turnover)

 Bournvita - leading brand in the brown

drinks segment of malted food
products.
 Overall share in the malted food drinks
market is estimated at 15%.
 Cadbury re-launched Bournvita with a
new formulation and advertising
campaign positioning it on the health
benefit platform.
 Cadbury’s other products include
Cadbury’s Drinking Chocolate and
Cadbury’s Cocoa powder.
 These account for only 1% of Cadbury’s
turnover.
 MALTED FOOD DRINKS

WHITE DRINKS BROWN DRINKS

Market leader Market leader

Smithklines’ Horlicks Bournvita

 Other significant players-

-Heinz (Complan) ,
-Nestle (Milo)
-GCMMF (Nutramul).
 Cadbury has a 15% market share in
the malted food drink segment.
CHOCOLATE CONSUMPTION
 Per capita consumption - around
160gms in the urban areas, compared
to 8-10kg in the developed countries.
 In rural areas, it is even lower.
 Strong volume growth witnessed in the
early 90's when Cadbury repositioned
chocolates from children to adult
consumption.
 The biggest opportunity likely to stem
from increasing the consumer base.
 Cadbury and Nestle have been
attempting to do this by value for
money offerings, which are affordable
to the masses.
 COMPETITION
 Dominates the chocolate market with
about 65% market share.
 Nestle has emerged as a significant
competitor with about 24% market
share.
 Other national players in segment
include Amul and Campco, besides a
host of unorganized sector players.
 Leading national players in sugar
confectionary segment include Nutrine,
Parry's, Ravalgaon, Candico, Parle’s,
Joyco India and Perfetti.
 BUSINESS
 Cadbury dominates Contribution
to
Contribution
to
the Indian chocolate Turnover Turnover
market with a 65% 1994 2001

market share. Chocolate 59% 65%

 It has a 4% market Sugar
share in the Confectionery
9% 10%

organized sugar
Food Drinks 32% 24%
confectionery market
and a 15% market
share in milk/ malted
foods segment.
 PERFORMANCE
 Sales of Rs6.26bn in 2001.
 Volumes grew by 5.8% lower than the
targeted 10% volume growth.
 Value growth marginally lower at 9.7%
over the previous year as against 12%
target set by the company.
 The sales increase was due to launch of
affordable small pack variants for all the
leading brands
 Focused innovative advertising
campaigns for flagship brand Dairy
Milk.
 Net profit rose by 10% to Rs.574mn.
 BALANCE SHEET
Period ended 12/98 12/99 12/00 12/01

No. of months 12 12 12 12

SOURCES OF FUNDS

Equity capital 238.0 238.0 357.1 357.1

Capital reserve 0.0 0.0 0.0 0.0

Share premium account 831.9 831.9 713.5 713.5

Profit & Loss/ General

756.2 950.1 1,251.5 1,455.0
reserve

Reserves and surplus 1,588.1 1,782.0 1,965.0 2,168.6

Net worth 1,826.1 2,020.0 2,322.1 2,525.7

Secured loans 18.9 37.6 3.8 8.8

Unsecured loans 189.0 65.1 18.8 62.1

Total debt 207.9 102.7 22.6 70.8

Capital employed 2,034.0 2,122.7 2,344.7 2,596.5

 STRATEGY
 Increasing the consumer base by
focussing on the twin proposition
of affordability and availability.
 Small affordable priced packs
launched, which have helped
improve penetration.
 Advertising for chocolates aimed
at changing consumer perception
and eating habits by creating new
reasons for consumption.
THANK YOU