VIVEAT SUSAN PINTOMumbai, 11 January

When it comes to stock marketrecords, it’s mega-companieswith armies of professional

managers that come to mind. But MrsBectors Food Specialities, a Ludhiana-based entity promoted by a woman entre-preneur, Rajni Bector, has shown thateven well-run small and medium com-panies can attract investor interests. Its~541-crore initial public offering (IPO),which was launched in December,remains the most subscribed issue in overthree years by any company.

The firm, whose FY20 turnover was ~762crore, listed on December 24 at a 74 per centpremium to its issue price, putting a smileon investors’ faces even as the Covid-19 pan-demic has dragged on for months. Thoughthe stock price has since corrected, analystssaid there is still some upside left as brand-ed food players such as Mrs Bectors benefitfrom the shift in consumer appetites toorganised players.

“The pandemic has turned consumers’attention to organised food players as theneed for hygienic food prepared in a safeenvironment grows,” said Kaustubh Pawa-skar, associate vice president, research, atMumbai-based brokerage Sharekhan.

This trend is unlikely to change even asIndia moves towards vaccinating its popu-lation this week. The government will beginadministering doses to health workers andfrontline responders from January 16.

Mrs Bectors is the largest supplier ofbuns to quick-service restaurant (QSR)chains such as McDonald’s and BurgerKing in India. The company is also a man-ufacturer of biscuit and bakery productsunder its Cremica and English Ovenbrands, respectively.

The firm exports its biscuits to over 60countries and plans to utilise some of its IPOproceeds to set up a new biscuit line at itsplant in Rajpura, Punjab.

While the QSR side of the business,which contributed 18 per cent to its FY20revenue, will continue to chug along as out-of-home eating gradually improves, it is thebiscuits side of the business that showsmaximum potential, experts tracking themarket said.

In a conversation with Business Stand-ard, Anoop Bector, son of Rajni Bector andmanaging director of the company, admi-tted that there was scope to take its Cremicabrand of biscuits pan-India from the north-ern markets, where it is currently present.

“We hold a 4.5 per cent market share innorth India in the premium and mid-pre-mium biscuit segment. This can certainlyexpand given that biscuits as a categoryhas grown in the wake of the pandemic.Consumers are seeking convenient foodproducts made by strong organised players,” he said.

Mrs Bectors derives 37 per cent of itsrevenue selling biscuits under the Cremicabrand, its FY20 numbers show. Biscuitexports account for 22 per cent of revenue,pointing to its potential in international mar-kets. “We have a share of 12 per cent in theIndian biscuit exports market. This would-n’t have been possible if we weren’t meetinginternational yardsticks,” Anoop Bector said.

How did the four-decade old, largelyfamily-managed company become astock-market star? Rajni Bector, now 80,is an affluent home-maker who didn’t allowher free time to kill her. She had a passionfor cooking and baking in particular, pro-ducing ice-creams, cakes and cookies forguests and neighbours. She honed theseskills at her home and at PunjabAgricultural University in the 1970s by tak-

ing up a baking course. Orders began pour-ing in as she began churning up her good-ies for local events and festivals.

Her husband, Dharamvir, chipped inwith an initial investment of ~20,000,when she needed to organise herself inthe late 1970s. Her orders got bigger as shecatered to large events, parties and gath-erings, keeping a firm eye on quality andproduction standards.

Cremica, Bector’s first brand, wasderived from the fluffy ice-creams she wo-uld dish out in her backyard. English Ovencame later as Bector began making breadand buns as part of her expansion plans.

By the mid-1990s, Bector took hernext leap when she began supplyingbuns and liquid condiments toMcDonald’s. This business grew as moreQSRs turned to her for supplying bunsand other condiments.

Mrs Bectors Food no longer makes icecreams, but the name has stuck and hasbecome synonymous with biscuits, whichinclude cookies, creams and digestives.The company is also a contract manufac-turer in the biscuit category for companiessuch as Mondelez and ITC Foods, thoughthe share of revenue from this segment issmall at six per cent.

A recent report by brokerage AnandRathi estimated that the company couldtouch ~1,000 crore in terms of revenue inFY21, led by growth in organised foodcategories such as biscuits and bakery.The company has the potential to enternew food categories as the organised foodmarket in India evolves, the report added.

Mrs Bector, who is the chairman ofher firm, remains out of day-to-day activ-ities and is now mostly a mentor to heremployees that number over 4,000 andare spread across six facilities in Phillaurand Rajpura in Punjab, Tahliwal inHimachal Pradesh, Greater Noida inUttar Pradesh, Khopoli in Maharashtraand Bengaluru in Karnataka.

At a time when start-ups and onlinebusinesses are hogging the limelight fortheir rich valuations, Mrs Bector’s storyprovides comfort that traditional busi-nesses too can attract investor attention.

With capital from a record IPO, this home-grown bakery goods company is betting big on the biscuits market at home and abroad

MUMBAI | TUESDAY, 12 JANUARY 2021 TAKE TWO 7. <

The government has predicted thatthe economy would recover in thesecond half of the current fiscal

year. Real gross domestic product (GDP)contracted by 15.7 per cent in the first halfcompared to the previous year’s first half.The government expects the second halfto almost not shrink anymore in a similarfashion. But, employment statistics avail-able till the third quarter do not supportsuch optimism.

In the first quarter, when the economytanked by 23.9 per cent, employment con-tracted by 18.4 per cent — both in year-on-year comparisons. In similar compar-isons, in the second quarter, the economycontracted by 7.7 per cent and employ-ment by 2.6 per cent. Now, we know thatin the third quarter, employment shrankeven more, by 2.8 per cent.

Economic recovery either stopped inthe third quarter or it stopped showingup in recovery in employment. Month-on-month expansion of employment,which was very high in the initial recov-ery months of May and June, sloweddown in July, August and September,and has then been declining in each ofthe three months of the third quarter.Employment in December 2020 was 4.2per cent lower than in December 2019.Employment has stagnated well beforeits complete recovery.

By the end of December 2020, employ-ment was 14.7 million short of what it wasin 2019-20. But, this decline is only half thestory. The composition of this shortfall is

as worrisome as the shortfall itself.Urban India accounted for 32 per cent

of total employment in 2019-20 but for34 per cent of the total loss of employ-ment in 2020-21 till December 2020.Arguably, urban India provides better jobsand its greater share in the loss does notbode well for the recovery process.

Women account for a mere 11 per centin total employment. But, they accountedfor 52 per cent of the job losses. Much ofIndia’s growth acceleration depends uponthe increased participation of women inIndia’s workforce. But, they continue tobear a disproportionately high fraction ofthe cost of economic shocks. They suf-fered a disproportionatelylarge loss of employmentduring demonetisation andnow, they have borne a sim-ilarly disproportionatelyhigh share in job lossesbecause of the lockdown.

Next, job losses were con-centrated among theyounger workers. All agegroups below 40 suffered afall in employment till December 2020,while those above 40 saw a small gain in employment.

Although India’s working-age popu-lation pyramid bulges at the lower end ofthe age distribution, its workforce doesnot bulge similarly. Fourteen per cent ofthe working-age population is between15 and 19 years but only one per cent of theworkforce is in this age bracket. This isunderstandable assuming that most ofthem are still studying. But, while 20 percent of the working-age population is intheir twenties, they account for a lower 19per cent of the employed persons. Worsestill, these twenty-somethings accountfor 80 per cent of the job losses as ofDecember 2020.

Folks in their thirties account for 17 percent of the working-age population andmake for a higher 23 per cent of the totalworkforce. Apparently, youngsters in theirtwenties failing to get jobs in proportion to

their share in the working-age populationis a phenomenon of the last 10 years.Because the current cohort of the 30-something were 20-something a decadeago and their share in employment musthave been higher than their shares in pop-ulation then. This is not true of the 20-somethings of 2019-20. Nevertheless, thelockdown has dealt a tough blow to eventhose in their 30s. They accounted for lessthan a quarter of the total employed in2019-20, but made for 48 per cent of jobslost as of December 2020.

There were job gains in senior agegroups — those over 40. Evidently, India’sworkforce aged in 2020-21 during thelockdown. The share of those aged over40, which was 56 per cent in 2019-20,increased to 60 per cent by December2020. The share of the relatively younghas correspondingly shrunk. This age-ing of the workforce again does not bodewell for a stronger recovery in the sec-

ond half of 2020-21 or inthe future.

Graduates and post-graduates had a 13 percent share in total employ-ment in 2019-20. Theirshare in the loss of jobswas 65 per cent. Of the 14.7million jobs lost, 9.5 mil-lion were those of gradu-ates and post-graduates.

Finally, salaried employees whoaccounted for 21 per cent total employ-ment in 2019-20 made for 71 per cent ofthe total job losses.

Nearly 15 million less people wereemployed in December 2020, ninemonths after the lockdown hit people’slivelihood compared to those that wereemployed before the lockdown in 2019-20. Those who lost jobs were concentrat-ed in urban regions, among women,among the relatively younger workers,the graduates and post-graduates andthe salaried employees. It is easy toassume that by December 2020, India’sworkforce had not only declined quanti-tatively but also deteriorated qualitative-ly. Given this crater India has dug itselfinto on the employment front, the partyrejoicing a quick V-shaped recovery isdancing on thin ice.

The writer is MD and CEO, CMIE P Ltd

MAHESH VYAS

ON THE JOB

The recovery storytreads on thin ice

Mrs Bectors has ataste for expansion

THOMAS SEAL11 January

Twitter shares fell 7 per cent inpre-market trading after thesocial media platform perma-nently banned outgoingPresident Donald Trump.

The company confirmed itsdecision in a blog post on Friday,saying Trump’s tweets breachedpolicies by risking incitementto violence. It cited his posts onthe riots in the US capital lastweek.It’s a watershed moment

for technology platforms thathave faced conflicting pressureson one hand to restrict misin-formation and hate speech, anddefend free speech on the other.

Twitter was Trump’s pre-ferred channel for amplifyingattacks on his rivals, spreadingconspiracies and provokingother nations.

Mirabaud analyst NeilCampling said the ban showsthe company is making edito-rial decisions, and opens thedoor to more regulation of

social media under the nextadministration.

“In the US, it’s about how arethese companies being regulat-ed, are they regulated, shouldthey be regulated?” Camplingsaid. What’s more, Trump is“the most popular character”on the platform, he added.

Twitter’s move, just daysbefore Trump is due to leaveoffice, followed a suspension ofthe president by Facebook,whose founder and CEO MarkZuckerberg said Trump’s most

recent posts showed he intend-ed to use his remaining time inoffice to undermine a peacefuland lawful transition of power.

Twitter had also suspendedTrump on Wednesday for post-ing a series of tweets that misledusers about the presidentialelection results, and appeared toencourage violent rioters whohad mobbed the US Capitol.One included a video messageof Trump expressing love for theinsurgents and calling the elec-tion “fraudulent”. BLOOMBERG

It is easyto assumethat byDecember2020, India’sworkforce had not onlydeclinedquantitativelybutalso deterioratedqualitatively

Twitter shares fall 7% following Trump ban

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SHARE PRICE SINCE THE LISTINGMrs Bectors Food Specialities (~)

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Source: Company financials