Group 4

Deba Jyoti Pani 16PGHR16

Deepti Saluja 16PGHR17
Pranshu Swaroop Dogra 16PGHR35
Sanajana Ramavarapu 16PGHR46
Shubham Agarwal 16PGHR50
KPMG Consumer Market Report A Taste of the Future
Main Manufacturers of Chocolate in the World
Source : KPMG Report A Taste of the Future
 CADBURYS PRODUCT SHARE
Other, 6%
Ferrero, 6%

Nestle, 21% Dairy Milk

Others 35%
47%
Cadbury,
67%
Bournville
and Silk
18%

Source: CNBC 2015 article: Future of Chocolate Industry

 India is the Worlds fastest growing market for chocolates
400 Kgs of Chocolate consumption per minute in India
Registered 15% annual growth in the past 5 years
Valued at INR 58bn in FY 2015, has been growing at a CAGR of ~15%
over the last three years.
It is estimated that the industry will be worth nearly INR 122bn by FY
2019, growing at a CAGR of ~16%
Increasing disposable income, changing lifestyle, rising trend of
gifting chocolates instead of traditional Indian sweets, and a surge in
the sale of dark chocolates are expected to drive the industry growth
 British multinational confectionery company owned by Mondelz International

Cadbury was established in Birmingham, England in 1824, by John Cadbury

Major chocolate brands produced by Cadbury include the bars Dairy Milk, Crunchie,
Caramel, Wispa, Boost, Picnic, Flake, Curly Wurly, Chomp, and Fudge; chocolate Buttons

Major market for Cadbury is United Kingdom, Ireland, United States, Australia, New
Zealand, Canada, India
 Brand Portfolio
Chocolates

Beverages

Snacks

Candy

Gum
 6.8%
8.5%

15%

69.7%

Chocolates Milk Food Beverages Confectionery Gum

Source : Investis Cadbury Report

 1800
1600
1650
1400
Cost in millions

1200
1000
800 870.4
600
400
429
200
0
2010 2011 2012
 Skimming Pricing

Cost plus pricing

Positioning Pricing

Demand Based Pricing

Price Elasticity Relatively Inelastic. Demand < 1

Income Elasticity Relatively Inelastic. Demand < 1

Cross Elasticity Complementary Goods Relatively Elastic

Cross Elasticity Inelastic

Substitution Goods
 Income
Population and Age Group
Brand Image
Consumer Preference and Taste
Expected Future Price
Competition
Price of Complementary Goods
Price of Substitute Goods
Celebrations and occasions (Supply increases)
Advertising Campaign
 Number of suppliers

Expected price

Price of input costs

 Short run for Cadbury

Long run for Cadbury

Economies of scale for Cadbury

 FINANCIAL ANALYSIS
2014 2013 % change
Revenue 35,760,753 33,550,501 7
Gross profit 13,100,096 10,992,421 19
Results from operating activities 5,720,687 3,858,560 48

Profit before income tax 7,421,477 5,361,692 38

Profit for the year 6,023,219 3,350,113 80
Share Capital 1,565,187 1,564,594 0
Total Equity 23,994,931 20,039,356 20
DATA per 50k share
Basic Earnings per share 192 107 79
Net assets per share 767 640 20
Stock Exchange quotation at 31 December 59 29 103

Market Capitalization at 31 December 184,692 90,746 104

 BALANCE SHEET
2014 2013
Assets
Property, plant and equipment 16,929,458 13,937,517
Intangible assets 11,698 54,636
Total non-current assets 16,941,156 13,992,153
Inventories 1,880,654 2,043,855
Trade and other receivables 6,390,008 6,266,805
Prepayments 211,649 611,565
Cash and cash equivalents 17,749,157 17,242,130
Total current assets 26,231,468 26,164,355
Total assets 43,172,624 40,156,508
Equity
Share capital 1,565,187 1,564,594
Share premium 11,543,821 11,517,941
Other reserves 3,436,348 3,435,975
Share based payment reserve 35,201 13,884
Retained earnings 7,414,374 3,514,579
Total Equity 23,994,931 20,046,973
 BALANCE SHEET (Contd.)
2014 2013

Liabilities

Deferred taxation 476,448 113,989

Employee benefits 4,314,464 3,097,739

Total non-current liabilities 4,790,912 3,211,728

Bank overdraft - 1,500,000

Current tax liabilities 845,485 662,989

Trade and other payables 13,541,296 14,742,435

14,386,781 16,905,424

Total liabilities 19,177,693 20,117,152

Total equity and liabilities 43,172,624 40,156,508

 STATEMENT OF PROFIT AND LOSS & OTHER COMPREHENSIVE INCOME
2014 2013
REVENUE 35,760,753 33,550,501
Cost of sales (22,660,657) (22,558,080)
GROSS PROFIT 13,100,096 10,992,421
Other Income 59,032 116,398
Selling and distribution expenses (5,970,810) (5,030,985)
Administrative expenses (1,467,631) (22,219,274)
RESULTS FROM OPERATING ACTIVITIES 5,720,687 3,858,560

Finance income 1,770,124 1,646,298

Finance cost (69,334) (143,166)
NET FINANCE INCOME 1,700,790 1,503,132
PROFIT BEFORE INCOME TAX 7,421,477 5,361,692
Income tax expense (1,3998,258) (2,011,579)
PROFIT FOR THE YEAR 6,023,219 3,350,113
OTHER COMPREHENSIVE INCOME (524,368) 104,878

TOTAL COMPREHENSIVE INCOME FOR THE YEAR 5,498,851 3,454,991

 Indian Connect World Leader

Placement & Distribution STRENGTHS Power House brand

and Products

Promotions Positioning as Gift

 WEAKNESSES

Cadburys It is inexcusable
weakness is its for a brand like
rural distribution Cadbury to show
considering India ignorance on
has such a wide quality control at
rural diaspora all. Thus quality
which can be control needs to
covered be strengthened.
 1 2
Penetrating rural New tastes and
markets and new flavours are
distribution in an opportunity
rural markets can which Cadbury
be a large can generate
opportunity for regularly.
Cadbury.
Health consciousness on the rise

Competition from Substitutes THREATS

Government Regulations
 Cadbury (2016) Wikipedia from: http://en.wikipedia.org/wiki/Cadbury
Bized Cadbury: http://www.bized.co.uk/dataserv/chron/news/3413.htm
BBC NEWS Cadbury plans to increase prices:
http://news.bbc.co.uk/2/hi/business/7252144.stm
Business Today The Strategy
Summit.:http://archives.digitaltoday.in/businesstoday20030706/features
7.html
Reem Heakal What Are Economies of Scale? :
http://www.investopedia.com/articles/03/012703.asp