Adani Wilmar's AWL fortunes were boosted by the steady growth in domestic demand and prices. The next phase of growth may be fuelled by its little-known international ventures.
The largest edible oil company was able to grow its top line by 25 per cent to 37,090 crore last year thanks to the rising edible oil prices. It also raked in Rs 2,746. 2 crore or close to 7.5 per cent of its total sales comes from its exports business.
The calculated steps it has taken since has the potential to grow the share of its international business in the coming years. A single deal that could propel the company towards its overseas ambitions is behind it all.
In June of this year, AWL took full control of Adani Wilmar Pte. AWL's latest move has placed it as a prominent player in the region despite the fact that the group entity has a paid share capital of Rs 57 crore $7.6 million, while the entity was under Wilmar International's maze of dozens of companies in the South-East Asia region since 2009.
AWL has hit many birds with a single stone. AWL now has access to a lot of other crucial subsidiaries that used to come under the umbrella of AWPL, which is something that has full control over AWPL. For instance, you can take Leverian Holdings Pte that shares the same office as AWPL. Leverian is a full-owned subsidiary of AWPL and is now under the direct fold of AWL.
Leverian also owns Bangladesh Edible Oil Ltd. BEOL - one of the largest edible oil players in the neighbouring country, besides trading imports and exports of edible oil. The Dhaka-based entity sells 30,700 tons of palm oil a year and markets popular brands like Rupchanda and Meizen. According to a recent report by Roundtable on Sustainable Palm Oil, BEOL was founded in 1993 and has since been aggressive in the marketing of consumer pack edible oil under household household brands. According to Angshu Mallick, CEO Managing Director, Adani Wilmar, the Bangladesh business may give it an additional Rs 2,000 crore revenue per year. He told Business Today that we expect to get 15 -- 20 percent of our revenue from international business.
BEOL is now marketing AWL's flagship brands like Fortune rice bran oil and King's sunflower oil in the market. Industry estimates suggest that edible oil market in Bangladesh is currently pegged at 16,000 crore and is growing at an impressive 9.5 per cent CAGR compound annual growth rate. AWPL acquisition does not limit AWL's influence in Bangladesh and Singapore. BEOL refines crude degummed soyabean oil and crude palmolein and distributes them in the local market. It also buys mustard, rice bran oil and rice for sale. It also owns another Dhaka-based company - Shun Shing Edible Oil, which is involved in crude oil transport and oil processing services.
Our company acquired the total equity share capital of AWPL on June 25, 2021 and, accordingly, AWPL, Leverian, Bangladesh Edible Oil and Shun Shing have become subsidiaries of our company AWL Adani Wilmar. Additional business and access to new territories are expected to be a major boost to AWL's overseas business as a result of these acquisitions in FY 22, according to the company's DRHP draft red herring prospectus. According to AWL s management, the company is already one of the largest exporters of castor oil and castor oil derivatives, and one of the largest exporters of oleochemicals in India. China is the largest market for its products and services. In FY21, AWL exported oil and oil derivatives worth Rs 1,055 crore or 38.4 per cent of its overseas sales to China.
It claimed to be a global company in castor oil and derivatives and is the only company with storage facilities outside India Currently, the firm has storage facilities in Rotterdam Netherlands for Northern European markets, in Marseille France and in Meer Belgium for Southern Europe.
In order to expand the global footprint, AWL is currently exploring distribution opportunities in other major castor consuming nations.