Adani Wilmar Ltd
NSE:AWL
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Adani Wilmar Ltd
Earnings Call Analysis
Q1-2025 Analysis
Adani Wilmar Ltd
Adani Wilmar's Q1 FY'25 earnings call highlighted significant growth and robust financial performance amidst a stable demand environment. Let's delve into the details that make this company a strong candidate for potential investors.
Adani Wilmar reported a commendable 13% year-on-year rise in sales volume, climbing from 1.43 million metric tons to 1.62 million metric tons. On a consolidated basis, the company's volume grew by 12%, enhancing revenue by 11% to INR 14,169 crores. This volumetric growth was indicative of broader business health, with gross profit spiking by 58% and EBITDA rising from INR 122 crores to an unprecedented INR 619 crores .
The Edible Oils segment showed strong performance, with a 12% volume increase translating to revenues of INR 10,649 crores, up 8% year-over-year. Products like sunflower and mustard oil were standout performers, with mustard oil seeing the introduction of a new premium product, Pehlidar. This segment also achieved a record profit of INR 398 crores, benefiting from stable oil prices .
The Food & FMCG segment showcased impressive growth, with revenues soaring by 40% to surpass INR 1,500 crores in Q1. This growth trajectory is expected to continue, possibly closing the fiscal year at around INR 6,000 crores, up from INR 5,000 crores last year. The company's wheat flour and rice businesses remained steady and poised for further expansion by leveraging its extensive edible oil distribution network .
Adani Wilmar's market share also saw improvements, notably in edible oils, where it consolidated its position from 18.4% to close to 19%. Its direct reach now spans 740,000 outlets, up 18% year-on-year, covering approximately 2.1 million outlets, including rural areas. The company’s focus on HoReCa channels and branded exports, which are growing at 15% and 36% respectively, further underscores its expansive distribution strategy .
The company maintained a strong EBITDA margin of over 4%, driven by stable pricing and demand. Despite past challenges due to inflation and inventory losses, Adani Wilmar adapted its hedging policies and expects stable performance in the coming quarters. The company anticipates a continuation of this positive trend through the festive seasons, underpinning its optimistic revenue and profit growth forecasts for the remaining fiscal year .
Adani Wilmar’s strategic focus on product innovation, market expansion, and robust financial management has positioned it well for sustained growth. With continued efforts in improving distribution reach and penetrating new markets, the company remains an attractive proposition for investors looking for stability and growth in the FMCG sector.
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Ladies and gentlemen, good day, and welcome to Adani Wilmar Q1 FY '25 Results Conference Call, hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Karan Bhuwania from ICICI Securities. Over to you, sir.
Thank you, Charan. Good afternoon, everyone. It's our pleasure at ICICI to host Adani Wilmar Q1 FY '25 Results Conference Call. From the management, we have Mr. Angshu Mallick, Chief Executive Officer and Managing Director; Mr. Shrikant Kanhere, Chief Financial Officer; Mr. Saumin Sheth, Chief Operating Officer. I'll hand over the call to the management for their opening remarks, post which we can open for the Q&A. Over to the management. Thank you.
Okay. Thank you very much, and welcome to the Q1 25 earnings call of Adani Wilmar. Thank you very much for joining -- taking out the time and joining this call. As a ritual, we will run through a very crisp presentation to talk about the performance and the financial results of the company, and then we'll open the floor for the question and answers.
A quick snapshot on the results summary. The sales volume grew by 13% year-on-year from 1.43 million in Q1 '24 million to 1.62 million in Q1 '25 as far as the stand-alone numbers are concerned. In consolidated, however, the number grew by 12% from 1.49 to 1.66. The growth in volume is also reflective in all the other parameters of the business in terms of revenue, gross profit and EBITDA impact, all have shown the increase. Revenue grew by 11% on a standalone basis, gross profit by 58% and EBITDA gone up from INR 122 crores to INR 609 crores on a stand-alone and INR 619 crores on a consolidated basis. The improvement in EBITDA and the margin profile is, of course, on account of last year Q1 '24 got impacted because of the hedge disalignment, which was behind us and not now anymore with us. So that's the basic reason why the margin metrics actually has improved as compared to the last year.
This slide gives you a little bit of idea on how the gross margins on a normalized basis is moving, I think, and this is what we have been saying for the last couple of calls that since December '23, that is Q3 '24 quarter, we are back to our normal run rate of gross profit as well as EBITDA. Gross profit of INR 1,756 crores for June '24 and EBITDA -- normalized EBITDA of INR 609 crores. This is after taking into account all the normalization impact, which are required, which basically include a derivative impact.
Quick update on the company business update. The volume, as I said, grew by 12%, revenue at INR 14,169 crores. We could register the highest ever EBITDA of INR 619 crores for this quarter. The demand environment for the branded and food is steady and is improving. Company is now staying focused on getting market share, particularly the food and oil both where we have been able to gain the market share.
On ESG front, company has been included in FDIC IV Goods Index series. And of course, all the ESG efforts on the ESG performance continues for the company. Particularly on Edible Oils, we recorded 12% improvement in year-on-year in terms of volume. The revenue now stood at INR 10,649 crores in Q1, up 8% from last year. We have seen a strong growth in sunflower and mustard oil both. Both oils have been able to showcase a very good growth in year-on-year terms. As far as the mustard is concerned, we are also trying our our product range in the premium category. We have launched one product called Pehlidar, which is cold pressed -- which is a first pressed wood pressed mustard oil. And we are continuing our efforts to launch more and more premium oils in and around food as well as edible oil. We have been able to achieve the highest stable profits in Edible Oil in Q1. The segment profit for Q1 '25 now to that -- this time stood at INR 398 crores. This is also on the back of stability in the edible oil prices that we have seen in last -- in this last gone-by quarter, which is Q1. The movement in edible oil prices, we are range bound between $100 to $150, not more than that. This has also helped us particularly for the companies who have got a brand in front. The Food & FMCG highlights, revenue grew by 40%. This includes the government-to-government business also, which we did in Q1, and revenue now stood at INR 1,500 crore plus crore. So by this run rate, the food business ideally should close the year FY '25 by close to INR 6,000 crores, which was INR 5,000 crores last year.
The branded food is scaling up consistently for last more than 11 quarters. The Food is growing at 30% year-on-year. Wheat flour business continued its growth trajectory by gaining market share and by growing on a year-on-year basis. Rice business stays steady. We are leveraging our edible oil network to see that our food product keeps growing at a 30%-plus kind of year-on-year growth. So this is a trajectory which we are trying to showcase, particularly in edible oil. If you can look at Q1 '22, we were close to 660,000 tons of oil to now 1 million ton of oil in Q1 '25, which puts up CAGR of 15% on Edible Oil. The stand-alone EBITDA has grown up from INR 118 crores now to INR 604 crores, which is quite a -- which is quite significant. Market share, we are consistently improving in spite of being a strong number one. We are steadily consolidating our market share from 18.4% in June '23 to now close to 19% in June '24. The capacity utilizations are at a reasonably good level. 63% suggesting that we have enough capacities in place as we speak today to accommodate any kind of growth that we may get in coming quarters.
The growth trajectory of the food and FMCG business also is very impressive, just like edible oil. From Q1 '22, when we were at close to 120,000 tons for a quarter to now plus of 300,000 tons is growing at a 38% CAGR. Revenue is growing at 44% CAGR from INR 520 crores in Q1 '22 to now close to INR 1,500 crores in Q1 '25. So the quarterly trend looks very good. The market share is also consistently improving in from 5% in June '23 to now 5.9% in June '24, steadily growing close to 100 basis points of growth. Basmati rice consumer PAT market share is more or less flattish, but we have been able to maintain our number 3 position in this particular segment.
If we look at a segment-wise profitability for the Q1, the stand-alone EBITDA is down INR 669 crores, of which INR 604 crores came from edible oil. Food & FMCG INR 31 crore, where we are still spending whatever we are making at a gross margin level, we are spending on distribution and various other schemes to continue the growth rate that we are getting in the food. Industry Essentials at INR 48 crores and an allocable expense -- unallocable coating or so that's how the segment results stacks up, which is called e as compared to the same period last quarter -- last year.
A quick update on our general trade distribution. Now we are -- our reach to the trade, including the direct as well as indirect is close to 2.1 million outlets. Of that 2.1 million outlets, 740,000 outlets we are reaching directly. So that is 18% year-on-year growth. Rural town coverage is consistently growing. We are now covering close to 30,000 towns in rural towns. Our target, of course, remains same that we want to cover close to 50,000 towns by March '25.
The alternate channels besides the general trade are also growing very fast for us. The alternate channels clocked the revenue of close to INR 759 crores in Q1 '25, that is 15% year-on-year growth. E-commerce and quick commerce continues to grow faster than the general trade. The HoReCa which is the channel which we are developing for the last 2 years is also showing a very encouraging results for us. The HoReCa revenue crossed INR 150 crores plus in Q1 '25, and INR 500 crores plus in last 12 months basis. We have added 7 new towns now during the quarter, taking the total coverage of the HoReCa channel now to close to 48 towns. We also further plan to expand this coverage of HoReCa channel to 100-plus large terms in near future. The branded export, which is also a focus area of company for the last couple of years now, we are exporting to over 30 countries now. The food business contributed 44% of branded export and therefore, it's growing at a rate of 36% year-on-year.
These are the couple of BTL consumer engagements company I'll not spend much time on them. But the message of the slides is that we are consistently spending on distribution, BTL and advertisement to take the brand to every category of the customer.
These are some of the branding which we did for the metro rail and -- so that the reach to the consumer is more effective. So in short, the final takeaways for Q1 '25, if I have to summarize them all is that there is a volume growth of 12% year-on-year. The Edible Oil volumes have crossed 1 million tons now for the quarter. The Food & FMCG revenue stood at INR 1,500 crores. Particularly in Edible Oil, it grew by 12% with very significant growth that we have seen in sunflower and mustard, particularly. Food & FMCG volumes grew by 42%, and the revenue also grew plus of 30%. Distribution reach has now gone up 18% year-on-year to reach at 740,000 direct outlets. Rural town coverage at 30,000. And alternate channel, which is also a focus area is growing very fast. ESG efforts of company continues, and this is a result of that, that we have been included in FTSE4 Good Index series recently.
So this is it from my side as far as the presentation is concerned, I just briefly talked about the numbers. I hope the audience who have joined the call have consumed the numbers and performance, which we have declared yesterday.
And now therefore, I would ask the moderator to open the floor for question and answer.
[Operator Instructions] The first question is from the line of Abneesh Roy from Nuama.
Congrats on a very good set of profits. My first question is on the EBITDA margin. I wanted to understand, is there any one-off here, 4% plus EBITDA margin? And FY '24, I understand was very tough because of sharp inflation, followed by sharp deflation and then a lot of inventory impact of losses were there. So are there any learnings, have you changed your hedging policy in any way your inventory overall, any change there, which has led to some incremental profits here. So if we assume this kind of a pricing in terms of the edible oil, would you expect a 4% plus margins to sustain if nothing changes? I understand that this is a real world and the geopolitical issue can always keep changing. But any one-offs here and any comments if you can give?
So Abneesh, just to answer your question straight, there is no one-off in the numbers which have been declared. So it's a normal business profit, number one. Number two, of course, last year has rightly put in by you. The last year numbers got impacted because of hedge reserve disalignment, which we experienced, not only we, but actually the entire industry experienced that. Number three, of course, when the prices are stable and the demand is good, usually the brand business does well, and that's what happened to us. And therefore, the numbers are quite encouraging for us in this quarter. And therefore, as we go forward, we are hopeful that no such geopolitical issues will come up and the supply chain of the commodity and price levels would more or less will remain in range. I think we should be able to continue this run rate in the coming quarters as well.
Sir, my second question is on some of the competitive intensity from new players. So if I see Amul, they are advertising a lot on the print media and out-of-home, also in Mumbai at least, in terms of their organic products. So two questions here. Would you also have a thought process on India-specific organic products because a lot of organic products are available, which are of suspect quality also. Of course, Amul would address that part. And second is, amongst pricing, of course, would be premium given it's organic, but what will be the impact on your business, if you could tell us that from a longer-term perspective?
Okay. The first one is on the print ad and their spend, BTL and all that. Every company has a budget with which it has to manage its ATL and BTL. We are also reasonably okay in print, and we also have almost annual plans with the Times of India and others. So print-wise, whatever the commodity business or the staples business can afford, we are there. And we are the largest spenders of edible oil, for sure. So there, we have both social media, television and all that. Secondly, it comes to organic products. So organic, one is the scale. Most important is that companies like us will always like a supply chain, which can provide us with the quantity that we need when we grow the business. And unless we have a backward integration, we won't be able to succeed. Now honestly to get into this organic, first, it required 3, 4 years of work without using that organic product as organic because it needs 3 crop season to get into the purity farm. Without that, we couldn't get a certificate. That is one. Two, we need farmers and then we have to have complete back end with the contract farming and all that, which is a very big operation. Amul has the strength. They have a farmers organization. And hence, they have that source or the supply side secured, and that is their strength. So since that is their strengths, they are playing with their strengths. I don't think companies like us can do everything big in organic unless we get into big time, contract farming and then have patients for 3 years minimum growing crop and managing that. So as of now, the other side of the business is very big for us. We are already in the staples, which can grow fast and you are seeing we are growing at 30%, 40% per annum year-on-year. So we have great scope to do that. So basic staples, we are more interested because there the scope is any time high. Organic and all these are very small niche market of the entire biggest pie.
My next question will be on the opening remarks on premiumization. So here, if you could tell us specific in premium edible oil, there is one large player and then another player got sold off by the U.S. parent to So if you could tell us how is your participation, are you happy with the performance of the last 2, 3 years in that part of demand? I understand it's very small versus your scale, but ultimately, if that is the premiumization, that is where the market growth will be faster. So can you discuss that part, how big is it?
See, presently, only one company has a substantial share in the blended oil premium category. Rest all these brands are very small or niche and not available throughout the country. Now we have functional oil put under the category expert. So the expert range we have brought, which handles only the expert -- as an expert, it can like functional oil, we have sugar concise, immunity booster and the third one is the total balance. Apart from that, we have just started one cold press Pehlidar, first press, what we call it, not the cold press because all kaChina kachi dhani can be cold pressed, but the first press is only the softer part of the mustard seed is crushed first, and the oil is taken out, and then it is bottled. This oil has high aroma, high pungency and is much better encased. It's like the extra virgin olive oil, but it is even better than that. So that we have just introduced a month or 2 months back, and the initial responses are good. This will be a value-added premium product. Apart from that, the expert range. And in the expert range, we will add expert low GI white rice, low GI basmati rice, and low GI atta. And all this will be under the expert range, which will deal with people who have sugar problem or any other.
But let me tell you more than consumer side premium, we are working on the B2B business and trying to make that premiumization. One is maida. We have where we can make now, especially for the bun, for the cream rolls, for the croissant, for pizza, for -- we are now doing for noodles specialty. Now these are special flours, which is used for special application and they fetch a premium because of the consistency in quality. So we are looking at both consumer in-home as well as out-of-home B2B consumers.
Understood. Just one follow-up I had on the edible oil. So in palm oil, sir, we are seeing on disruption by the market leader in soaps. They have cut their palm oil by 25% in two of their brands. How does this impact your business from a raw material side and possibly in some of the byproducts you sell to the soap players. How does this impact from longer term? I understand these are very early days. But given its market leader and the confidence they have shown on this, can this impact both supply side and your demand side, raw material side and your demand -- your consumer side?
I don't think we are in that arena of supply chain. Whatever we import, we make our palm oil and then the PFAD that we have goes for our oleochemicals business. Yes, we do sell soap to most of the big so-called soap manufacturers because we are one of the largest soap manufacturers in the country. We do supply glycerin and steric acid also to oleochemical products. But I don't think that will impact the palm oil business, anybody here. And overall, the share of palm oil in the soap is not so significant, honestly. So that is not going to impact anybody for that matter, either the Malaysia or the Indonesia players or even in India anybody.
The next question is from the line of Harit Kapoor from Investec.
Congrats on good numbers. I just had 2 or 3 questions. One was on the Food & FMCG side. So while I understand that the government orders would be coming at a lower margin, but I just wanted to get a sense of why we have seen a year-on-year reduction in the profits on this side, especially because if scale has been good even in the non-government order business has grown at 19%, 20%. So if you could just give us an answer, particularly in this quarter because what's really happened that will be helpful.
Sorry, your voice was actually breaking. So can you just spell out your question again?
. Yes. So what I was trying to ask was the profit margin in the Food & FMCG business have been a tad lower this time. I understand one reason is that there is a government order business. And -- but even on an absolute basis, the profit numbers have been a bit lower. So what would we be attributing that to? Is it a commodity impact? Is it higher investments in promotion and the distribution. Just help me understand that.
Yes. Okay. So got but your question very clearly now. So I think the profitability, and this is what we have been saying for quite a couple of quarters that we are investing now more and more in distribution and advertisement and other infra so to ensure that the kind of growth which food and FMCG has been showing continues and we get to a very a reasonably good level of food and FMCG basket, which currently, I think this year, we should close at 1.25 million tons of basket. And that's the reason why the food and FMCG margins are like this, plus and minus. I mean there's not a significant movement in margin. But I think by design, is that we are keeping -- we are basically investing whatever we are earning at a gross margin level into the infrastructure for distribution as well as other -- on other heads.
Got it. Got it. The second part, again, on food and FMCG. If you could just give us a sense of what the nature of this kind of government order is? And if it is likely to persist going forward as well in a similar kind of
See, you are aware that government has banned exports of white price and broken rice. Now what government has done is that if they receive any orders from friendly government countries, they approve export, but that we can't do directly. We have to route it through the cooperative companies in India, which are or you can say, NCER or even are NAFERD to some extent. So these are the companies through whom we have to build and they will bill to the counterpart in that country, and that is how it will be exported. So government to government means from here, any of the cooperative firms nominated by central government can be the exporter. We can't be the direct exporter. Our job is to procure the rice from the market and process and pack and send it to the port at FOB level. And after that, we have to sell it to NAFERD or anybody, and NAFERD will be the exporter. So this is the G2G business. Small margin, but good volume and it helps you in overall rice business because if you are a normal exporter also, then it helps you. So that is why we are doing. And this will -- I can't say it will last for long because these are all government orders. Tomorrow if the white rice is open, the way it was earlier, then the G2G business may not happen or it may continue if the duty is still imposed and the government to government business doesn't have a duty, then possibly this business will continue. So going forward, I can't say much about it. As of now, if there is a business, we are not losing that opportunity because it helps us in utilizing our same manpower, logistics support, port operations, everything remaining same, so it gives us margin.
Got it. Got it. No, makes sense. The -- the other part is in Food & FMCG. So again, if you look at the kind of shares in what flour versus the basmati rice, over the last 3 quarters, you've seen wheat flour shares actually move up fairly significantly, almost 50 bps over a 3-quarter period, Rice has been fairly stable. I just wanted to understand the competitive dynamics between these two segments? And what kind of allowing you to win faster in wheat flour versus rice currently. While obviously on a Y-o-Y basis, you're doing extremely well on the share. I just wanted to understand, last few quarters, what are the different dynamics playing out here between the two?
Very good very good observation. On wheat flour, let me tell you, there is one big competitor, having 40%, 45% market share. And then we are the second largest at 5.9%. And then below us, there may be 10 brands, 2%, 3%. That means this entire market is very fragmented with only 1 player. So to garner share from the small, small players is relatively easier, relatively easier, one. Two, our distribution in South and strategy in South marketing strategy, all this has clicked well. And that is why our South market share has gone up to 7.5%, 8%. But if you see Chennai, we are almost 18%, 19% in Chennai City. That is because we did some marketing activities, which clicked, and the demand went up very, very fast. So that is the reason why you see at, we have done so well. Now let's go to basmati rice. Basmati rice historically has 2 players who are there in the market for more than 25 years. Now they both have around 35 and 30 -- 60%, 65% market share. And they are quite a strong player, and they manage that. Rest of the brands, there isn't any -- we are at 8% or something. Rest, below us, there may be small, small players are very, very fragmented players, or private label also possible. Now here, the large two brands are strong in their work, and 60%, 65%, they are holding very, very clearly. Here's the gap to garner from 10 to 15 will be relatively little tough. But yes, we have done some reworking like in last year, we pushed Kohinoor, and the Kohinoor market share has gone up. But I think more of distribution we have to do and we are working on it. Our Gohana plant will be ready by November. That would be the first IPO project plant where we are putting almost 600 tons per day, paddy to rice line, and 500 tons per day rice to rice line. It will be one of the largest food park in the country, having integrated operations of mustard oil, oil, cottonseed oil, then I have maida there, wheat flour, rice, everything. So this plant will be big. So we are waiting for that. Once that happens, the quality of the product, the performance, yield, everything will be much better, and we will have a big supply chain support. Once you have a big supply chain support in commodity business brand and that part will help us in pushing. I'm confident that this market share will increase to 10%, 12% in another 3 to 4 quarters.
I had just 1 last thing on the distribution side. You obviously mentioned about the rural town coverage. I just wanted to understand what are the similar March '25 targets for direct reach? And the second question on that was how much of our current direct reach is also being used for Food & FMCG already. I mean, obviously, would all be -- I mean, edible oil will be reaching across that. But how much would Food & FMCG has reached now in that 7.2.
Okay. See, today, except June, our direct reach, means a salesman going and booking order from an outlet and recapturing that data was at 7.4 lakh. Cost of which almost INR 3.5 lakh was rural and rest 400,000 almost was urban. Now we are doing now roughly 30,000. Q1, the rural coverage, we couldn't expand much because of the election and heatwave. But our target exit target, March '25 is 50,000 target. And we are hopeful of reaching very near to those figures because the Q1 we lost, honestly. So we have 3 quarters to go, and we have to reach 50,000. That is one. So we are working on that. Second is this 50,000 would almost represent 70% of the potential rural town and the business. So we will have much bigger strength of rural distribution. Harit, you said that how many outlets are there. See, when I say oil outlet, did not be that they buy all the oil. If you go to South, they may not buy soyabean or mustard, but they are buying sunflower. Now in East, it is mustard. So oil wise, if you see, mustard has the highest penetration amongst any oil in the country for both us as well as for Nielsen also says that, mustard as the highest penetration. So we have almost direct reach of roughly 3 lakh outlets out of 7.5 in mustard. Sunflower soybean has around 2.5 lakh outlet. Atta is around 25,000 outlets. Like this, there will be a different number of outlets. But on the whole, one or the other product is covered and is purchased by 7.4 lakh
Of the 7.4 lakh target on where you
Unique food can be as high as 3 lakh outlets, but not that everybody is keeping all the product. Some people may not keep besan. Some towns in Maharashtra -- UP I have seen, they keep besan nuggets, may not keep rice, like this, you will get. So about 3, 3.5 lakh retail outlets keep food total 7.5 lakh outlets we are covering. And every outlet will buy some of the products we sell in that area.
The next question is from the line of Ayan Kartik from Outlook Business.
I just wanted you to throw some light on the kind of competition you are seeing from regional and local players because in the last one, we have seen a lot of brands reporting competition from a local players. I just wanted to understand what has been different on Adani Wilmar in Q1 and what kind of trends you're per se?
Ayan, I will tell you, when the oil prices were high, say, last to last year, local players were really doing well because the inflation and the prices were much higher. So brands like us would have costed them INR 25 per liter more. Today, when the edible oil prices are stable, brands like us have much more strength because in terms of pricing power, in terms of purchase power, supply chain, distribution. So our sales of Fortune has increased, number one. So competition for us is less in refined oils, more will be in mustard oil because that is the domestic oil and it gets processed in many parts of the country. But we still are the clear leader by around 15% we have a margin, and the next brand is around 6%. But it's a very fragmented market, mustard oil. When it comes to food. This business is dominated by regional press. National players say in Atta, there is only one, technically. In dal, there isn't any national brand. Besan also there isn't any great national brand. 3, 4 good regional brands out there. So in food, we have to fight with the regional brand. And our with the regional brand is always on quality, consistency, price, value for money, distribution, reach and brand. And second, our distribution in e-commerce and modern trade. So there, we continue to fight with the local players and getting the shares. And we will have to fight with the local players because there isn't any national player.
The next question is from the line of Rohan Patil from Turtle Capital.
Sir, as of financial year '24, we did sales thing right?
Mr. Patel,you are sounding a lot muffled. If you're using the speaker, please?
Is it now audible?
This is much better, sir. Yes, please go ahead.
So I just want to clarity. As of financial year '24, I'm talking about rice, we did somewhere around 50,000 metric tons, right?
No, 50,000 metric tons you are seeing for what overall rice?
Yes, overall, overall.
No, no, no. 50,000, we -- in FY '24, we did much more than 50,000 tons.
Yes. Would we share the quantum?
This quantum is as such is not available in the public domain as such, but we can give you an idea of what amount -- what volume of rice we did in FY 2024. This is a little higher than 200,000 tons.
Okay. And out of that, how much would be the branded part and non-branded part?
The branded part would be around 40%, 50%. And private label exports are there, which are their brands, which we export. So that is also there. So altogether, brand, brand for us, more than 50%. 30%, 40% would be around private label, depending on which country like Saudi and other places, private label goes. And rest is local B2B.
Okay. So roughly in a range of 50%, I can the branded.
More than 50% will be branded.
Okay. The export percentage like out of the 200,000-plus we have done, what would be the export as a percentage?
25% exports, 75% domestic.
And if you can help me out. Do you do a
We do drive, but small quantity.
Small quantity. Top 4, 5 export destination?
Export destination would be Australia, Saudi, UAE.
Okay. And are you looking into growing your own brand? Or you want to also grow the private label -- in private label also because in Saudi, one of our competitor isn't present, which is to be present over there. So are you leveraging on that opportunity also to increase your
The competitor of the one you are referring to, they have done some work and they have got some investments from Saudi and possibly having a tie-up for distribution. But for us, we are doing 3P, but we are also working through our Wilmar JV partners those who are interested, like in U.S., Australia, other customers. So we refer to export in our brand Fortune.
Okay. I get that. And can you share some rough idea about what EBITDA margins or rice division would be making?
That will be...
See, right now, I think what we have been saying for last couple of quarters...
Most of our food is basically an EBITDA neutral, and that is basically by design because we are spending more on distribution and other infrastructure.
Okay. And if you can just share...
Mr. Patel, may we request you return to the question queue for
Just last question. Just last question. Okay. Okay. Just for understanding, if I can ask one last question. So what are you targeting for FY '25 with the volumes in rice?
We will be targeting much more volume. We are just waiting for our Gohana plan to get ready and commissioned. That commissioning, once it happens, we will have in-house supply chain. So I can tell you one thing that we are looking at 30%, 40% growth year-on-year for the next 3 years.
[Operator Instructions] The next question is from the line of Karan Bhuwania from ICICI Securities.
Congratulations on good set of numbers. So I have two questions. Firstly, you had highlighted that sunflower oil has done good in this quarter, right? And I do remember that sunflower oil, if I look at market leadership, you are market leader in other oils, but sunflower you So the highlight the initiatives you have taken for driving this growth? And what is the market share gain in this particular segment?
Okay. See, one is that sunflower oil is surely is part of our focus area. It is a oil which always gives consistent good margin. Now as far as oil is concerned, we have enhanced our processing capacity, and we are possibly one of the -- we are second largest importers in the country of sunflower oil. And we have almost the largest processing capacities across the country. Now as far as sunflower oil is concerned, South and West accounts for 85% of the market. And in these markets, South we were weak. So we made some strategies, and we did some work on it and slowly and steadily year-on-year we have seen the results come in and our South market share has gone up. Accordingly, our sunflower oil market share, if I'm not wrong, has gone up from around 10.1% to 11.3%. So we have gone up by 1.2%. And I don't think there is any other brand in the country who have shown any growth in the Q1. So we are the only people who have grown. That is because we did some work on it. We are hopefully #2 now, if I'm not wrong because I have not seen the last figure, but I -- we were #3 earlier behind Gold But now I think we are number two.
Got it, sir. Very helpful. is, I just wanted to understand, you have been historically slightly weaker in the Southern market, right? And now you're winning market share in the wheat segment -- sorry, in the wheat category in the South market. So just wanted to understand how are the synergies working in terms of distribution between the Edible Oil and Food segments for the Southern market?
I think I have always said earlier also when people used to ask me or analysts, you did ask me that how are you going to win South? And I had always said that what is our strength is that we have a basket of products. We are not only in oil. We have oil, rice, flour. We are 3 big things. Now we will play with all the 3 things together. And we will win because we have an offering to the retailer, and that exactly we did that. We went to the sunflower oil retailer, gave them Atta at an offer where they couldn't reject and they took. And slowly, the market started accepting the Atta. And now Atta sales say, in Chennai city is almost equal to sunflower oil sales. So that is how we have started doing well. And going forward, to win South, we will have to win by our strength and which is our portfolio product.
Got it. So that is very helpful. Lastly, sir, rural versus most of the FMCG companies have been highlighting that they have seen greenshooting in the rural markets has outperformed the urban for the last couple of quarters. If you could highlight something or how do you see the demand for your production in rural versus urban?
See, rural has been under pressure. Every -- all the FMCG players have been mentioning this. Our staples business, obviously, the first choice for any consumer has to be staples and then any other product. So we did not get impacted, but we did not grow also. Our share, 29%, 30% remain at that level. So rural contributed only 30%, which we felt should have been more. Now going forward, we see some some positive lights mainly because one, the monsoon is likely to be good, and we are all seeing that happen. Two is that the government's initiative is investing more in the rural area for schemes and all that. And if this brings more employment, more rural productivity and all that, I'm sure rural consumption will grow. As staples business, consumers prefer first to buy their sugar, wheat, atta, rice and then any other products. So I'm sure that we will see a good growth. Going forward, I think October onwards, the rural market should do better.
The next question is from the line of Deepak Mandana from Investments.
Congratulations on great set of numbers. I just have one query. Basically, can you just give me an overview of how your industry essential business is growing because none of your PPT presentation covers that. So what is the -- because I can see that the value mix as well as the volume mix is growing there. So can you just give me a fair idea about Industrial Essentials business.
Okay. See, Industry Essentials, we have 3 main products. First is oleochemicals. Second is castor oil and derivatives. And third is our which we use for cattle feed or animal feed, which is mainly soya, or DOC, mustard DOC and rice brand DOC. Now you take oleochemicals business. Oleochemical business has been doing very well for us. And we are -- we have the largest oleochemical complex in the country. We are 25% producers of in the country and almost 32% steric acid. We make almost 10% soap in the country after you take away the in-house consumption of Lever's and Godrej. If you take that out, which is 6 lakh tons,, out of 4 lakh tons,, we make almost 1 lakh ton soap So we are reasonably strong in oleochemical player. We have recently acquired 1 company, World where we are -- Omkar is the company's name that we have -- they have downstream specialty chemical products, and we have good business understanding about it. So we thought we need some partner to grow this business. This is a profitable business, and we are working on it to grow this business. So that is specialty chemicals. Second comes castor oil. We are world's largest exporters of castor oil and processors. So that business has been doing well. We are getting into derivatives because that is value addition. So next new CapEx on derivatives is going on. So castor, we will grow this business. and make it much more profitable. And the third one is your DOC. What has happened is the summer, the DOC business was less, and that is why you see that the volume growth is not there. It is only because of the rapeseed meal we couldn't export what we had targeted. But the next -- this quarter possibly that will be covered because it goes on rollover for the next month or so. So we should -- yes, please.
Just as a follow-up, I wanted to ask that, are we also looking in terms of export for the specialty chemicals business? Or is it just for the domestic production only?
Presently, we do export our steric acid, glycerine, even soap We do export. Going forward, specialty chemicals will be -- it is application based, suppose any product which is required, and we have a country where we can sell, we will surely explore. Wilmar also big in oleochemicals business. So they also have clients outside their area of operations like China and Malaysia and Indonesia. So they also have in Europe. So we can also export their. So export will be our area of operation as we go around.
And just a last question. You have said that your...
Sorry, I'm just coming in between just to give you a better idea on -- because you had asked that whether this business is growing yes or no. I think see, out of the 3 components, which Mr. Mallick mentioned, castor, oleo the meal. Castor and oleo, both are growing in double digits. So castor grew by close to 10% and oleochemical grew by 13% year-on-year in this quarter. But there was a degrowth of oil mill business of 22%, and that's where the entire category degrew by 7%. Having said that, the oil mill business is, of course, depending upon the parity and the market conditions. So that's not something which is a very sustainable business. But castor and oleo are the main segments of this industry essential segment, which are growing in double digit.
So I believe we are EBITDA positive on both the segments?
Yes, very much.
So the next question we will take from an e-mail, which we have received from one Mr. Kumar. And he has a specific set of questions, particularly on the Bangladesh operations, where in its first question was that why the Bangladesh unit is under the loss since many quarters, though the India business has recovered back?
So see Bangladesh has got a different problem. First of all, we actually faced a problem on the currency front last full year. Besides that -- I mean, Bangladesh also faced macro headwinds, the way other economies are also facing in terms of inflation and interest rates. So the government was trying to put in price control in the country, and therefore, price control, coupled with the currency problem had some issues which we had last year, and therefore, we suffered losses in Bangladesh last year. However, after the elections in Bangladesh recently, the new government is in place and the things are now improving. So for this quarter, we had a loss of close to INR 10 crores, which is far, far less than what we had in the same quarter last year. So that has been now taken care of. Things are improving from here. Currency situation has already been improved there. So the availability of dollars in the country is no more an issue. We still have some issue around the parity, which is getting resolved. So as we go forward in the quarter 2 and quarter 3, I think you will see the improvement in the Bangladesh operations.
The second question was when likely Bangladesh unit will recover from profit? I think I answered in the first question itself.
And the third question is not related to Bangladesh, but it is on the OFS is there any plan for an OFS for AWL?
So I think we have mandatorily have to see that the minimum public shareholding is achieved by Feb '25 given the fact that we got listed in Feb '22. So we otherwise have to do that. Now OFS is one part of it. So I can't comment whether it is going to be OFS or any other method. There are specific methods listed by the SEBI, which can be used by the promoters to achieve the NPS. But I can only confirm on this call that yes, the efforts are on to achieve that NPS of 25% for which the 13% dilution by the promoter would be on the cards from today till Feb '25. But whether it will be OFS, I can't right now comment on that.
The other last question was future guidance of revenue and profit growth given the oilseed prices in international market and hedging other I think the prices is what we have been saying. The prices have been stabilized. We saw Q1 numbers quite healthy given the fact that there was not much volatility in the prices. So we are hopeful that this scenario will continue along with the stability in prices and demand will also continue given the fact in H2 that there will be a lot of festivities in India and demand will be more than what we have experienced in the quarter 1. So this performance, we can expect, but having said that business is always a business. You can't foresees some of the hidden risk, but that will always be there. So we are hopeful. I think we should continue with the current performance as we go forward.
So this is what we had on an e-mail. I think I'll hand it over again to moderator if there are any other participant in the queue to ask any questions they can open.
Well, there are no further questions. I would like to hand the conference over to the management for closing comments.
Yes. On the behalf of Adani Wilmar, we are thankful for attending this call, and we encourage all the participants to participate in our call and hear story and performance. Thank you very much.
Thank you all, and we hope we have a good festive season starting this month, followed by a big wedding season coming from November. And we hope the monsoon is going to be good. Overall, overall, the atmosphere remains positive and consumption looks to be solid. And I think all the FMCG companies, including us, should do well in the next 3, 4 quarters. Thank you all.
On behalf of ICICI Securities, that concludes this conference. Thank you for joining us. You may now disconnect your lines.