Wilmar Looking to Emulate ITC Business Model Post Adani Group Exit

Adani Wilmar Ltd (AWL), India’s largest edible oil producer, is pivoting its strategy to strengthen its high-margin FMCG portfolio by leveraging its dominant edible oil business and extensive distribution network. This approach mirrors the strategy employed by ITC, which successfully used its core cigarette business as a foundation to expand into the FMCG sector. Following the exit of the Adani Group, AWL is expected to intensify its efforts in introducing more global FMCG brands into the Indian market to drive growth further. 

In the December quarter, AWL's FMCG business achieved a 24% year-on-year growth in volume, highlighting the company’s focus on diversifying its product offerings. The contribution of food and FMCG to overall volumes has increased to 20%, with its share in total revenues rising from 5% in FY21 to 9% in FY24. The company has reported robust growth in its food category, with products such as wheat flour, rice, nuggets, pulses, poha, and sugar experiencing strong double-digit growth. Additionally, AWL’s e-commerce segment, including quick commerce, saw a rapid year-on-year sales increase of 41%, significantly enhancing the reach of its food products, particularly in urban markets. 

AWL's edible oil business, spearheaded by the Fortune brand, provides a critical foundation for its diversification efforts. Its distribution network, which reaches over 2.1 million outlets, has been instrumental in expanding the reach of its food and FMCG products. Although the edible oil segment’s contribution to total revenue is steadily declining, it still accounts for approximately 80% of revenues, with 10% coming from B2B sales. The segment’s revenue grew by 39% year-on-year in the December quarter, driven by a 25% rise in oil prices over the three-month period, while revenues from the food and FMCG segment grew by 22% in the same period.