AWL Agri Business Q1 FY26 earnings call

AWL Agri Business Limited reported a Q1 FY26 revenue of ₹17,000 crores, marking a 21% year-on-year increase. Despite this, overall volumes saw a 5% decline, primarily due to the absence of the G2G Rice business from the previous year, with normalized degrowth at 2%. The company achieved an EBITDA of ₹572 crores and a PAT of ₹238 crores. EBITDA per metric ton stood at approximately ₹3,500, and gross margin per metric ton was ₹11,121, aligning with management's expectations for normalized levels.

The Edible Oil segment recorded a revenue of ₹13,415 crores, growing 26% YoY, but volumes were down 1% in Q1 FY26 due to high palm oil prices earlier in the quarter. Management noted a significant shift with palm oil prices now falling below soya bean and sunflower, which is expected to normalize^📎 sales. The company, being the largest importer of palm oil, anticipates benefiting from this correction and the recent increase in differentiated duty between CPO and olein, which favors domestic refining capacity. The segment's ROCE improved to 18% over the last 12 months, up from 14% three years ago.

The Food & FMCG segment's volume declined by 5%, but revenue grew 4% to over ₹1,400 crores (4% YoY excluding G2G business). The segment achieved a standalone EBITDA of ₹82 crores in Q1 FY26, with an EBIT margin of 5.3%. Management emphasized a strategy of consolidating regional rice businesses and focusing on branded offerings to improve profitability, moving away from low-margin bulk trading. Market share in Wheat Flour increased to 5.5% (from 5.3%), and Basmati rice reached 8.4% (MAT June). The company aims for ₹10,000 crores revenue from this segment by exit FY27, with ₹7,000 crores targeted for exit FY26.

The Industry Essential segment demonstrated strong performance with a 6% YoY volume growth and 12% YoY revenue growth, reaching ₹2,230 crores, and a segment result of ₹100 crores. This segment, comprising Oleochemical and Castor, is operating at 100% capacity utilization. The recently acquired GD Foods, which includes the 'Tops' brand, contributed ₹96 crores in Q1 revenue, up 9% YoY, and reported a healthy 11% EBITDA margin. AWL is implementing interventions like manpower rationalization and process institutionalization to enhance operational efficiency and leverage its distribution network for GD Foods' products.

AWL continues to expand its alternate channels, with overall growth of 12%, e-commerce growing 33%, and quick commerce growing 73% in Q1 FY26. Direct outlet reach has expanded to 870,000 outlets, with rural growth at 26%. Technology adoption includes 100% SFA software for sales and implementation of auto-replenishment systems. On the ESG front, the company planted 190,000 trees in June '25, increased renewable energy capacity to 10 MW (11% of total requirement), and installed zero liquid discharge systems in 11 plants with a capacity of 3,100 kiloliters per day.