The Hindu Business Line : Adani Wilmar to double capacity

THE Rs 1,250-crore Adani Wilmar Ltd (AWL), the 50:50 joint venture between Adani Exports Ltd and the Singapore-based Wilmar Trading Pte Ltd, has undertaken a massive capacity expansion project for its 950-tpd edible oils refinery at Mundra. Originally set up as a 600-tpd refinery, this unit is set to touch a refining capacity of 2,000 tpd over the next six months, by February 2004.

The capital cost for the doubling of refinery capacity has been put at Rs 80 crore. Currently, AWL imports crude edible oil to the tune of 25,000 tonnes per month from Brazil and Argentina. Once the additional refining capacity is put in place, the crude import is set to touch 55,000 tonnes per month.

The 1,050-tpd-refinery expansion is coming by way of a stand-alone plant at a location adjoining the existing refinery at Mundra.

The setting up of the separate unit has been fashioned largely by the tax breaks — both excise and sales tax — that are on offer from the Gujarat Government in Kutch, as part of its earthquake rehabilitation programme.

According to company sources, work on the capacity expansion drive is well under way with the placement of orders for plant machinery such as boilers having already been placed. While the decision to go in for the additional refining capacity has been centred around the success of its Fortune brand edible oil, Adani Wilmar is also toying with the idea of exporting the refined oil to nearby countries come February 2004.

The Fortune branded edible oil from AWL is the market leader in the soya oil segment with 48 per cent market share just as its overall market share among branded edible oils have been hovering around 15 to 17 per cent.

It is AWL's hope that the augmentation of refining capacity would help it reach 25 per cent of the all-India edible oil pie during the next fiscal.

Earlier, in 2002, the company was planning to double the then existing capacity of the refinery at 600 tpd to 1,200 tpd at a capital outlay of Rs 95 crore.

At that time, it was also planning to put up a refinery at Kakinada to cater to the southern and eastern domestic markets. However, the Adani group shelved its Kakinada plans though its partner, Wilmar Trading decided to go ahead with the project.

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