Ahmedabad-based Adani Wilmar Ltd is planning to extend its flagship edible oil brand Fortune to other commodities such as basmati rice, pulses, dal, besan and nuggets over the next two years.
The company, a joint venture between Singapore’s Wilmar International Ltd and India’s Adani Group, had undertaken a market survey on the possible extensions of the Fortune brand about two years back. “Fortune is a trusted brand among Indian households. Extending product offerings makes under the established brand more sense than creating new brands,” said Angshu Mallick, chief operating officer of Adani Wilmar.
The company had already done test-marketing for pulses under the Jubilee brand. As it would launch the whole range of commodity products under the Fortune brand, the Jubilee brand will be “killed”, Mallick said, adding Jubilee was created for test-marketing only.
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The products will be pushed through Adani Wilmar’s existing network of 1 million retail outlets across the country. “We wish to launch all commodity products under the Fortune brand. However, we will not enter the ready-to-eat or ready-to-cook segment,” said Mallick.
All pulses products will be produced and packed at its Haldia factory, which will be ready by May 2013. “We are also planning to augment capacities at all our factories over the next six to 12 months. The augmentation would essentially include setting up high-speed packaging lines. The capital expenditure this year is likely to be higher than the earlier years,” he added. The company, on an average, spend about Rs 200 crore to Rs 250 crore in capacity expansion every year.
The eastern region has emerged as one of the key growth markets for Adani Wilmar with consumption in Bihar rising. “East is going to be focus the next year,” Mallick said.
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Adani Wilmar expects a 20-25 per cent increase in volume during 2013, from about 18 per cent volume growth during 2012. It hopes to close the 2012-13 with more than 20 per cent growth over Rs 12,500 crore reported the previous fiscal year. “We target a 15-20 per cent revenue growth during FY14,” said Mallick.
Wooed by the healthy properties of rice bran, Adani Wilmar has launched 100 per cent rice bran edible oil early this month. Marico’s Saffola Gold and Agrotech’s Sundrop Heart are products that blend rice bran with other oils such as sunflower or kardi.
Adani Wilmar has priced the product at Rs 115, much lower than the rice bran branded ones priced at Rs 150 a litre.
The overall edible oil market in volume terms is pegged at 16.5-17 million tonnes (mt). Of this, palm oil alone constitutes 9.5 mt. With the balance consisting of soyabean oil and mustard oil at 2 mt each, sunflower oil at 1.2 mt and coconut oil at 500,000 tonnes. Rice bran oil, considered an emerging segment, has only about 200,000 tonnes at the moment in branded form.
According to Mallick, prices of edible oil are likely to come down by about 10-15 per cent by April 2013, as estimated based on the weather conditions this year.