Sending a Birthday Gift to Employees

I recently met a company which has over 2000 employees and one of the programs they run is to send a birthday gift to all employees on their respective birthdays. The value of the gift is around INR 500. I wondered if the INR 1 lakh they spend is really worth it. I asked the HR manager if they have questioned the spend on this. He told me that once in a while, someone asks if we should be doing this and if we would do it if we were a larger organization. He went on to tell me why they felt the birthday program was important for them.
1) This was one of the few things where everyone in the organization from the CEO to the cleaner boy were treated as equals – they would all get the same gift in the exact same packaging during a calendar year.
2) They viewed this as a touchpoint – their leadership believed that they need to make use of every opportunity to touch the employees - they felt that a person’s birthday was a significant day in the employee’s life and it was the employer’s obligation to acknowledge the employee on this day.
3) The company had almost 40% of its employees who were factory workers. This population expected management to only offer them gifts on important occasions – big festivals like Diwali, Christmas etc. By recognizing them on their birthdays, it made these workers feel that the management/corporate office cared about them. So they actually wanted the gift to come from the corporate office rather than from their local supervisor - Ironical to our philosophy that managers are the ones who need to recognize the employees.
4) He also candidly admitted that since the birthday gifting program was in place, they were unsure about the impact if they removed it. Given the small cost, they would rather let the program continue than stop it and deal with any negative impact it may have.