Adani Wilmar Limited (AWL) has presented impressive results for the first quarter of fiscal year 2025-26, spanning from April to June. The company reported a total revenue of ₹17,059 crore during this three-month period.
Edible Oil Segment Forms the Backbone of Earnings
The largest contribution to AWL's revenue came from its edible oil business. This segment contributed ₹13,415 crore, accounting for approximately 78.6 percent of the total revenue. Furthermore, edible oil accounted for 61 percent of the company's total sales. This segment experienced a 26 percent growth compared to the same period last year.
Food and FMCG Segment Also Experiences Growth
AWL also recorded growth in its food and FMCG (Fast-Moving Consumer Goods) segment. The company earned ₹1,414 crore from this segment, which is 4 percent more than the first quarter of the previous year. While this segment's contribution to the total revenue is only 8 percent, it represents 16 percent of the total sales. The company increased the prices of some of its products this quarter, which aided this growth.
Industry Essentials Business Also Performs Well
AWL's Industry Essentials segment, which includes products like de-oiled cake and castor oil, also saw a 12 percent growth. This segment contributes 12 percent to the total revenue.
Cash Flow Utilized for FMCG Expansion
The company's strategy is becoming clearer. AWL is using the cash flow generated from its core edible oil business to expand its food and FMCG segments. This strategy is being compared to ITC, which invests profits earned from its cigarette business into other business segments.
AWL receives an annual cash flow of ₹1,200 to ₹1,500 crore solely from its edible oil segment. The company is using this money to launch new products, enter new markets, and expand the food and FMCG segments.
Increased Reach in Rural Markets
AWL has strengthened its retail reach across the country. According to reports, the company has increased its retail coverage by 18 percent. AWL's products now reach approximately 8.7 lakh retail outlets, including around 55,000 villages. This figure is 10 times higher compared to the fiscal year 2022.
Stock at Lowest Valuation in Three Years
AWL's stock is currently trading at ₹263 per share. This valuation is based on 30 times the earnings of the last 12 months, which is the lowest in the past three years. This implies that the company's growth potential is not yet fully priced in by investors.
Focus on Increasing Market Share
The company's current strategy focuses on increasing market share and expanding its portfolio. In recent months, AWL has added several new products to its brand portfolio, such as healthy cooking oils, instant foods, and ready-to-cook products. Simultaneously, there is a greater focus on rural areas, with modifications to packaging and pricing to suit local needs.
Efforts to Maintain Presence in the FMCG Sector
AWL has increased spending on branding and advertising to further its FMCG business. The company is now promoting its products more effectively in smaller towns and cities. This has helped maintain the pace of sales.
Image of a Company Catering to Daily Needs
A significant portion of AWL's business revolves around the daily needs of consumers. Cooking oil, flour, rice, and gram flour are its core products. The company is building a foundation for growth by strengthening the supply chain of these essential products.
