The below Rs 100 per kg biscuit segment constitutes 25 per cent of the Rs 37,000-crore biscuit market, experts said. Parle Products
is the biggest player in this category with Parle-G, said experts, though most other biscuit manufacturers, too, have brands priced at Rs 5 to partake of entry-level consumers.
Volume-wise, Rs 5 packs constitute over two-thirds of the biscuit market, given that it is both convenient and affordable.
However, in April-June 2019, the growth rate of the overall biscuit market fell to 2 per cent from 7 per cent earlier, led by a sharp decline in the growth rate of biscuits priced below Rs 100 per kg, sector experts said. Shah said this was due to the 18 per cent GST rate, which had forced biscuit makers to hike prices in recent months.
“Prior to the GST regime, there was no excise duty on this segment. This was in keeping with the profile of the consumer in that category,” he said.
“All we are saying is that GST should be at 5 per cent, rather than 18 per cent in this segment. Bread, also consumed by the mass market, is at zero per cent GST, while rusk is at 5 per cent,” he said.
In an investor call last month, Britannia’s Managing Director Varun Berry had also pointed to the general economic slowdown for people cutting back on biscuit consumption.