Adani Wilmar reported a 18 per cent drop in its consolidated net profit in the December quarter, while revenue fell 17 per cent on year on lower price realisation, despite decent volume growth in food, FMCG and industrial essentials segments.
The edible oils and staples maker reported a net profit of ₹201 crore and revenue of ₹12,828 crore. EBITDA at ₹504 crore also saw a dip of 17 per cent on year.
Edible oil, which constitutes 62 per cent of its total volumes, saw a small dip of 2 per cent in the quarter at 9.4 lakh tonnes. Industry essentials, contributing 22 per cent of volumes and food and FMCG contributing 17 per cent of volume, each saw 17 per cent rise in terms of volumes.
In terms of value, edible oil contributes 75 per cent to revenue and that also saw a 23 per cent dip. The company sells edible oils under the Fortune brand as well as a range of staples such as rice, wheat, semolina and others.
The average price realisation per tonne fell 21 per cent, while the EBITDA per ton was 20 per cent lower.
The company said that profitability normalised in the third quarter after two quarters of subdued profits due to high-cost inventory and hedge dis-alignment. It added that the branded products were scaling up fast, but export restrictions have been a drag on the foods segment. It said it expected to close FY24 with revenue of ₹5,000 crore in the foods and FMCG segment.
Adani Wilmar is on the block as the Adani Group plans to narrow its focus on the infrastructure sector, but divestment plans have been put on hold over valuation issues.
The company is doubling its reach in rural areas and plans to cover 30,000 towns by the end of the fiscal year. “We are putting our energies in rapidly scaling up our distribution network for General Trade to realise the immense opportunity available in the packaged staple foods,” said Angshu Mallick, MD and CEO.
The company intends following regional approaches such as differentiated pricing, launching regional varieties, different stock keeping units, and labelling packages in vernacular languages for making inroads into the hinterland.
With a view to exporting more, it has set up a dedicated exports team to set up distribution channels and develop new markets. Its products are currently exported to 38 countries.