AWL Agri Busine.

Adani Wilmar reported a robust Q3 FY25, achieving consolidated revenue of INR 16,859 crores, a 31% year-on-year growth, with underlying volume growth of 5%. EBITDA surged by 57% to INR 792 crores, and PAT more than doubled to INR 411 crores. The company highlighted consistent improvement in gross margins and EBITDA over the past five quarters, primarily driven by the edible oil business. The EBITDA per ton for the quarter stood at INR 4,956, benefiting from favorable market positions and inventory gains.

The Food & FMCG segment demonstrated strong volume growth of 23% in Q3 FY25 and 32% for the nine months ended December 2024. However, this segment recorded a loss of INR 46 crores in Q3 and INR 23 crores for 9M, mainly due to inventory valuation losses in rice. The edible oil segment grew 4% in volume for Q3 and 11% for 9M, registering a segment profit of INR 571 crores. The Industry Essential segment experienced a degrowth of 3% in Q3 and 9% in 9M, primarily due to lower edible oil business, though oleochemicals continued double-digit growth with healthy margins.

The company's IPO-funded Gohana integrated food facility, with an overall capital outlay of approximately INR 1,300 crores, commenced production for rice and mustard oil in January 2025. This facility, expected to be fully operational by Q1 next financial year, will significantly enhance processing capabilities (600 tons paddy/day, 500 tons rice/day) and improve logistics. Additionally, Adani Wilmar is expanding its pulses processing capacity with three new plants in Nagpur, Neemuch, and Kadi, each with a 240 metric tons/day capacity, aiming to become the largest chana processors in the country.

Adani Wilmar continues to focus on expanding its distribution network, aiming for 1 million direct coverage outlets by the end of FY27, up from over 8 lakh currently. Total reach exceeds 2.1 million outlets, with rural distribution expanding to over 40,000 towns. Alternate channels, including e-commerce and quick-commerce, showed robust growth of 41% and 81% respectively in Q3, contributing over INR 3,000 crores to trailing 12-month revenue. The HoReCa channel also grew to INR 600 crores in the last 12 months.

The edible oil market saw elevated prices for soya, sun, and palm, with palm oil being unusually costlier than sun and soya. This trend, coupled with high import duties imposed in September 2024, contributed to price volatility. Management noted that while prices corrected in late December, they remain higher year-on-year. The industry experienced subdued volume growth of 5% in Q3, with rural demand showing a stronger 8% growth compared to urban areas, which remain stretched.

Adani Wilmar targets an average growth rate of over 20% for its Food & FMCG business, aiming for INR 10,000 crores in revenue by FY27. The company plans to maintain the segment as EBITDA neutral until FY28, prioritizing market share and volume growth. Post-FY28, it targets EBITDA margins of approximately 10% for rice and 6-7% for wheat flour within 3-4 years. The strategy involves achieving a top 3, or even top 1-2, market position in each food category.