Adani Wilmar Sees 67% Profit Jump in First Quarter Despite Lower Revenue

Adani Wilmar Ltd, a prominent player in the edible oil and food-FMCG sector, has reported a significant 67% increase in its consolidated net profit, reaching Rs 156.75 crore for the quarter ending March, despite experiencing a dip in revenue. This performance marks a substantial rise from the Rs 93.61 crore net profit recorded in the corresponding period last year. However, the company's total income saw a decrease, falling to Rs 13,342.26 crore in the January-March period of the last fiscal year from Rs 14,185.68 crore in the year-ago period, as per a regulatory filing.

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For the fiscal year 2023-24, Adani Wilmar's net profit saw a downturn to Rs 147.99 crore from Rs 582.12 crore in the previous year, attributed to lower revenue. The total income also declined to Rs 51,555.24 crore last fiscal from Rs 59,148.32 crore in the 2022-23 fiscal. Despite these challenges, Adani Wilmar, known for selling edible oils and other food products under the Fortune brand, has seen robust volume growth in its core businesses.

Angshu Mallick, MD & CEO of Adani Wilmar, highlighted the company's strategic focus on increasing retail penetration and adopting a regional approach in sales and marketing as key factors for gaining market share from local competitors. The company's Food and FMCG business notably reached sales of 1 million 10 lakh tonnes, with overall company sales surpassing 6 million 60 lakh tonnes during the fiscal year. Mallick also pointed out that revenue in the Food & FMCG segment nearly doubled over the last two years to almost Rs 5,000 crores in FY’24.

The improvement in the branded mix of edible oils contributed to enhanced profitability for Adani Wilmar in the latter half of the last fiscal year. Additionally, challenges faced by the company's Bangladesh operations were mitigated by an improved forex situation and stronger economic fundamentals, leading to a return to normalcy this quarter. The brand "Rupchanda" continues to lead the market in Bangladesh in the edible oil category.

Despite a decrease in revenue for edible oils to Rs 38,788.33 crore from Rs 46,103.55 in 2022-23 due to falling cooking oil prices, revenue from food and FMCG business grew to Rs 4,993.99 crore from Rs 4,053.34 crore. In terms of volume, sales of edible oils increased by 9% to 3.67 million tonnes in 2023-24 from 3.36 million tonnes in the previous year. Sales of industrial essentials rose by 8% to 1.32 million tonnes from 1.23 million tonnes, while food and FMCG product sales surged by 16% to 1.03 million tonnes from 0.88 million tonnes.

In a separate development, Adani Wilmar informed that Dharmesh Parikh & Co. LLP, Chartered Accountants, have tendered their resignation as the Joint Statutory Auditors of the company effective from the close of business hours on May 1st, 2024. Appointed as statutory auditor in August 2022 for a five-year term, Dharmesh Parikh & Co cited increased professional preoccupations with other assignments as the reason for their resignation. The firm assured that their departure was not due to any inability to obtain sufficient appropriate audit evidence and that there were no other circumstances related to their resignation that needed to be brought to the board's attention.

Adani Wilmar stands as a joint venture between India's Adani Group and Singapore's Wimar Group, continuing to make strides in its sector despite facing various challenges.