Adani Wilmar Limited delivered a strong performance in the recent quarter, showcasing an impressive 18 percent year-on-year volume growth in the first half of 2024 and an 11 percent year-on-year growth in the second quarter of 2024. This remarkable growth can be attributed to factors such as increased consumer demand, favorable pricing of edible oils, efficient supply chain management, and successful branded sales in both edible oil and food categories. Despite these positive developments, there was a 13 percent year-on-year decline in sales revenue for both H1’24 and Q2’24, primarily driven by a significant correction in edible oil prices.
In spite of the challenges faced in the edible oil segment, the company maintained its growth momentum. The Edible Oil segment witnessed a 4 percent year-on-year increase in volumes during Q2’24, and branded sales recorded an impressive 12 percent year-on-year growth. This growth was primarily driven by the strong brand equity of Sunflower oil and mustard oil. Additionally, the Food and FMCG segment, which includes products such as wheat flour, rice, pulses, besan, sugar, poha, and soap, continued to perform exceptionally well, with segment revenues growing by 26 percent year-on-year in Q2’24 and 27 percent year-on-year in H1’24.
During Q2’24, the Food and FMCG segment accounted for 10 percent of the total sales revenue and 18 percent of the sales volume. The company is targeting an increase in the contribution of the food business to around 30 percent of the total sales volume in the upcoming years. This growth in the domestic food business has been substantial, primarily powered by the presence of strong brands like Fortune and Kohinoor.
The industry essentials business posted an impressive 25 percent year-on-year growth in Q2’24, driven by strong performance in the Castor and Oleochemical segments. Nonetheless, the company’s profitability was impacted by losses incurred in the edible oil segment, largely stemming from divergent trends in spot and future prices.
Angshu Mallick, MD and CEO, Adani Wilmar Limited said, “We continued the growth momentum across all the business categories, amidst the challenging environment in the edible oils segment. The Company gained market share across most of the edible oil and food categories, given the immense focus on expanding our direct reach and rural town coverage. We see a huge potential for packaged oils and foods in the rural markets. Today, 30 percent of our sales comes from rural towns, wherein more than 70 percent population resides. In the past 6 months, we have added over 13,000+ towns, and we will continue this growth. The out-of-home consumption continues to grow with our HoReCa business showing volume growth of over 50 percent+ on a QoQ basis. The revenues from the branded products under the Food and FMCG segment have been growing consistently at 40 percent+ YoY in the past 8 quarters. We are also simultaneously building our branded exports business, where we see potential to serve the Indian diaspora abroad. Given the importance of health and wellness in today’s era, I am pleased to share that the company launched Brown Rice under premium Kohinoor brand. While the profitability in edible oils were impacted consecutively for the second quarter, we believe that the abnormality will soon reverse.”