Sat. Dec 10th, 2022
Adani Wilmar Reports 73% YoY Dip In Net Profit In Q2FY23; Revenue Climbs 5% QoQ

Unfavorable environmental and economic factors hit Adani Wilmar’s bottom line for the quarter that ended September 30. The company on Thursday posted a consolidated Profit After Tax (PAT) at Rs 49 crore during the reported quarter, down 73 percent from Rs 182 crore in the year-ago period.

Revenue of the Fortune cooking oil maker marked a marginal 5 percent uptick during the quarter at Rs 14,209 crore, led by robust growth in Food and FMCG. It was Rs 13,584 crore a year ago.

Edible oil volumes remained dull on an on-year basis, thanks to the muted demand from the semi-urban and rural markets. However, sequentially, edible oil rose 17 percent in volume terms. It corroborates the demand for oil picked up in the second quarter of FY23.

Notably, despite the on-year slack, the company’s edible oils segment surpassed several macro headwinds: high inflation, rising interest rates, delayed monsoon, and tepid rural demand this quarter.

Earnings before interest, taxes, depreciation, and amortization, or EBITDA plunged 40 percent YoY to Rs 254.5 crore while margins shrank to 1.8 percent from 3.3 percent YoY.

“Sharp fall in prices of palm oil, soybean oil, and sunflower oil left most of the players with high price inventory in hand. The company also passed on the benefit of lower prices to the consumers. This coupled with currency depreciation impacted margins during the quarter,” the company said.

Food and FMCG cum Industry Essentials segments added life to the overall grim numbers. Food and FMCG grew 41 percent, while Industry Essentials grew 22 percent YoY.

“We have delivered a strong quarter with volume growth of 9 percent in the face of a challenging environment. The quarter saw multiple hurdles in the edible oils business. While the volume growth in edible oils was flattish on YoY, it has grown by 17 percent sequentially on a QoQ basis,” Adani Wilmar MD and CEO Angshu Mallick said.

“During the quarter, the volume share of Food and FMCG has gone up to 16 percent, and we expect to take this to 30 percent over the next few years.” On the outlook, he said, “Going forward, we expect H2 FY23 to be better with a recovery in consumer demand in the edible oils business too.”

Adani Wilmar is a joint venture between Indian conglomerate Adani Group and Singapore’s Wilmar Group.

By Harshita Sharma

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