Adani Wilmar, an Adani Group FMCG stock, climbed nearly 4.4 percent on Wednesday after the company posted strong volume growth for Q3FY23.
"This year, festivals and weddings were celebrated on a much larger scale compared to the base quarter, which got impacted by the lingering Covid effect." "We also benefited from stronger out-of-home (OOH) consumption," the company said in an exchange filing.
The company added, "In a volatile edible oil price environment during the year, we have been able to capture demand with our portfolio of popular and premium brands."
During Q3FY23, the edible oil business experienced high single-digit volume growth and low single-digit value growth in percentage terms.
The Food and FMCG segment continue to grow at a very strong rate, driven by increasing penetration and amply supported by widespread distribution network of edible oils across India. This segment delivered high-20s growth in volumes and mid-40s growth in value in percentage terms during Q3FY23, Adani said.
Industry essentials saw strong volume growth, driven by increased production and sales of de-oiled cakes (DOC) as a result of a good mustard and soya crop in India and competitive pricing in export markets, it added.
Following the company's Q3 business update, the stock opened strongly at ₹585 apiece compared to the previous closing price of ₹571.45 and then surged further to hit an intra-day high of ₹596.85.
At 12:00 p.m., the stock was trading at ₹581.20, up by ₹9.75 or 1.78 percent on the BSE.
Adani Wilmar stood out as the best-performing IPO in 2022 by delivering 130 percent return to its shareholders. The stock, which went public in February of last year, is currently trading at 152.9 percent above its IPO price of ₹230. The stock price rose 16.43 percent in the last three-week period, moving from ₹499 to ₹581.
For the fiscal year 2022, Adani Wilmar topped the FMCG chair, dethroning HUL. Adani Wilmar's consolidated revenue crossed the ₹50,000 mark and stood at ₹54,214 crore, compared to ₹37,090 crore in FY2021. While, HUL has reported ₹51,468 crore in sales in terms of yearly revenue in FY22.
Adani Wilmar, a joint venture between Adani Enterprises Ltd. and Wilmar International Ltd., is the owner of the Fortune brand of edible oils. It has the largest range of edible oils, comprising soya bean, sunflower, mustard, and rice bran. Its Fortune brand of oil has around a 20 percent market share in India, according to Edelweiss.
Adani Wilmar’s business activities include oil palm cultivation, oilseed crushing, edible oil refining, sugar milling and refining, specialty fat, oleochemicals, biodiesel, fertiliser manufacturing, and grain processing.
It has over 850 manufacturing plants and an extensive distribution network covering China, India, Indonesia, and 30 other countries.
Currently, two promoter entities—Adani Commodities Ltd. (a subsidiary of Adani Enterprises) and Lence Pte Ltd. (a subsidiary of Wilmar International)—each own nearly 57.174 crore shares (with a face value of ₹1 each) in AWL.
5 analysts polled by MintGenie on average have a 'hold' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.
