The Hindu Business Line : Reliance Retail bets on Punjab, Haryana to boost private labels biz

New Delhi, June 27 To augment its private labels business, Reliance Retail Ltd has signed up with both the Punjab and Haryana Governments to set up food processing units and procure land for cultivation of fruits and vegetables.

The move could translate into the company building two food processing units in Haryana and making Punjab one its large sourcing hubs for fruits, vegetables, dairy products and grains.

“Reliance Retail has recently acquired 20 acres of land from the Haryana Government at Saha and Rai. The plan is to build two food-processing units in the two places, with a total investment of Rs 100 crore,” said an industry source. The plants would be engaged in processing, packaging and distribution of fruits, vegetables, and milk products for the retail chain’s private labels. While the process of setting up the two facilities will begin in the next three to six months, they will become functional in the next one year.

Reliance Retail has also signed an MoU with the Punjab Government for acquiring three lakh acres of land for the cultivation of fruits, vegetables and food grains. “Punjab will play a major role in the company’s supply chain and logistics strategy. It plans to use the State for 10 to 15 per cent of its total procurement of fruits, vegetables and milk,” said the source. The company plans to procure a total of 2 lakh tonnes of fruits and vegetables and around 9 lakh tonnes of foodgrains such as rice and wheat all for its private labels.

Milk procurement

It has also tapped 1.5 lakh milk farmers across 3,000 villages in Punjab to procure 7 lakh litres of milk, which would be converted into dairy-based products such as ghee, butter, cheese and cottage cheese. “Reliance, in fact, intends to acquire or hire on contract basis dairy units in the State, where it could possibly start manufacturing dairy products such as ghee and butter under its private label,” said the source. Punjab will also be home to around 50 of the company’s planned 1,600 rural business hubs. The company’s private label business strategy includes a supply of products not only to its own outlets across the country, but also to other retail chains. It is also looking at the export options once the desired volumes are achieved.

More Stories on : Retailing | Foods & Food Processing | Reliance Industries Ltd

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