Amul to get a taste of Reliance

Mukesh Ambani's dairy business may be five times the size of Amul.

Reliance Retail is all set to give Amul a run for its money as the biggest procurer and retailer of dairy products ranging from milk to ghee.

The company plans a milk procurement target of 1 crore litre per day over the next four years, when its retail stores are fully rolled out across the country.

The targeted amount is more than the combined procurement of all players in the co-operative and private sectors. Amul, the largest milk co-operative in the country, procures around 64 lakh litres of milk per day. Amul Federation's sale stood at Rs 3,773 crore in the last financial year.

Though Reliance did not want to comment, sources close to the development said the company's overall dairy business was likely to be four to five times the size of Amul's, given the huge product range that it had planned.

Unlike co-operatives, the company is planning to set up a national manufacturing base of dairy products to feed its retail network.

The company is also looking at the possibility of acquiring existing private players in the segment. The rollout of dairy products will initially take place in Andhra Pradesh and Punjab, and then be extended to other states.

While unveiling his retail plans at the company's annual general meeting recently, RIL Chairman Mukesh Ambani had said the company would invest Rs 25,000 crore in the sector, with a sales target of Rs 100,000 crore over the next four years.

Calling it an idea which had the potential to revolutionise the Indian socio-economic framework, he said, "Conceptually, Reliance is creating a virtuous circle of prosperity by bringing together farmers, small shopkeepers, and consumers in a win-win partnership."