Acquisition process is a continuous evaluation that Adani Wilmar keeps on doing, said Angshu Mallick, MD and CEO of the company, while speaking to CNBC-TV18. He believes stressed assets are better buying options.
“We keep looking at stressed assets, organisations or brands. We are in staples, so anything in staples, we are surely looking at stressed assets,” he said while speaking with CNBC-TV18.
Fortune and Kohinoor are two strong brands Adani Wilmar has in the market along with the distribution network across the country. “What we need is assets to ramp up our production fast,” he said.
The company has set aside around Rs 500 crore for acquisition and around Rs 1,900 crore for capex.
However, he mentioned that the company would put in more money from internal accruals as Rs 500 crore may not be enough to buy the assets or brands that the company wants.
The dip the company saw in quarter one and quarter two wasn’t based on the volume, it was based on prices, he said.
“We have seen good consumption for the marriage season. We see great opportunity for basmati rice and edible oils,” he said.
The company has seen some dip in consumption in rural areas, particularly edible oil. “Forty percent share has come down to 38-37 percent. So, around a 2 percent dip has been seen,” he said.
In foods, Adani Wilmar continues to hold 25 percent share in the rural market, which is a healthy sign for the future, according to Mallick.
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The company is seeing good consumption for the wedding season. So, the CEO sees a great opportunity for the basmati rice and edible oil business.
“In edible oil, we see an increase of around 8-10 percent in volume,” he said.
He is hopeful of seeing good signs of growth from December onwards. “January onwards, the real thing starts. So quarter four of this year and quarter one of next should be a big one,” he mentioned.
According to him, overall agricultural business looks better. Agri crop and the remuneration on the farm output has been good.
For the full interview, watch the accompanying video
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