About the company:
Adani Group and the Wilmar Group formed a joint venture in Singapore in 1999. It is a fast-moving consumer goods (FMCG) food company that supplies most of the essential kitchen commodities to Indian consumers, including edible oil, wheat flour, rice, lentils, and sugar. The company provides a wide range of market needs in addition to oleochemicals, castor oil and its derivatives, and de-oiled cakes. “Fortune,” Adani Wilmar’s flagship brand, is by far the most recognized edible oil in India.
Adani Wilmar is an FMCG food company offering most of the essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses, and sugar. Their distributors are in 28 states and 8 union territories throughout India, catering to over 1.6 million retail outlets. As of September 30, 2021, the company had 88 depots in India, with an aggregate storage space of approx. 1.8 million square feet across the country.
Comparative Advantages:
- Strong brand recognition and a substantial client base.
- In India, they are the industry leader in branded edible oil and processed foods.
- Strong raw material sourcing capability from leading worldwide vendors.
- An integrated business model with a solid operational framework and production capability.
- A solid distribution infrastructure supports the Pan-India distribution network.
| Headquarter | Ahmedabad, Gujrat |
| Sector | FMCG Sector |
| Area of Operation | The company’s distributors are in 28 states and 8 union territories throughout India, catering to over 1.6 million retail outlets. |
| CEO & MD | Angshu Mallick (Working with the company in different positions for the past 23years) |
| Chairman | Kuok Khoon Hong (Co-founder and CEO of Wilmar International Limited |
| Subsidiaries | • Awn Agro Private Limited |
| Competitors | • Ruchi Soya Industries (Rs 25,000 Cr) • Marico Ltd (Rs 60,954 Cr) • Ajanta Soya Ltd (Rs 471 Cr) |
| Shareholding pattern | •Pre Issue Promoters Share Holding 100% •Post Issue Promoters Share Holding 87.92% |
IPO Details: Adani Wilmar
| Details | •IPO date: Jan 27,2022 to Jan 31,2022 •Price band: Rs218-Rs230 •IPO listing date: February 8, 2022 |
| Objectives of issue | •Funding capital expenditure for expansion of existing manufacturing facilities and developing new manufacturing facilities (“Capital Expenditure”); •Repayment/prepayment of borrowings; •Funding strategic acquisitions and investments; and •General corporate purposes. |
Profit and Loss Statement
Standalone P&L:
| Mar-17 | Mar-18 | Mar-19 | Mar-20 | Mar-21 | |
| Revenue from Operations | 22,973 | 26,354 | 28,802 | 29,657 | 37,090 |
| Expenses | 22,330 | 25,433 | 27,703 | 28,345 | 35,763 |
| Operating Profit | 643 | 921 | 1,100 | 1,312 | 1,328 |
| Profit before tax | 348 | 566 | 570 | 609 | 757 |
| Net Profit | 230 | 375 | 365 | 395 | 655 |
Standalone Balance Sheet
| Mar-17 | Mar-18 | Mar-19 | Mar-20 | Mar-21 | |
| Share Capital | 114 | 114 | 114 | 114 | 114 |
| Reserves | 1166 | 1540 | 1905 | 2298 | 2952 |
| Borrowings | 2622 | 2244 | 1829 | 2300 | 1904 |
| Trade Payables | 2993 | 5141 | 6615 | 1332 | 946 |
| Advance from Customers | 38 | 39 | 36 | 78 | 58 |
| Other liability items | 434 | 570 | 891 | 5504 | 7100 |
| Total Liabilities | 7,367 | 9,649 | 11,390 | 11,627 | 13,075 |
| Fixed Assets | 1950 | 2273 | 2954 | 3759 | 3702 |
| CWIP | 70 | 443 | 570 | 325 | 531 |
| Investments | 52 | 53 | 54 | 55 | 106 |
| Inventories | 2896 | 3748 | 4042 | 3826 | 4778 |
| Trade receivables | 842 | 1212 | 1262 | 921 | 1515 |
| Cash Equivalents | 894 | 1060 | 1189 | 1416 | 1188 |
| Loans n Advances | 687 | 758 | 1094 | 1208 | 1205 |
| Other asset items | -25 | 102 | 226 | 115 | 50 |
| Total Assets | 7,367 | 9,649 | 11,390 | 11,627 | 13,075 |
Financial Ratios: Adani Wilmar
Stock Price:
| 1. Asked Price | Rs 230 |
| 2. Market Cap | Rs 30,000 Cr |
| 3. Lastest GMP | Rs 55 (23.91%) |
P/E Ratio:
(It indicates the market value of the stock as compared to the company’s earnings)
| 1. Company’s ratio: Adani Wilmar | 44.66 |
| 2. Industry | – |
| 4. Marico Ltd | 51.85 |
| 3. Ruchi Soya Industries | 28.54 |
| 5. Ajanta Soya Ltd | 10.57 |
ROCE Ratio:
(It basically indicates the profit company is making from its total capital invested)
| 1. Company’s ratio: Adani Wilmar | 24.0% |
| 2. Industry | 21.40% |
| 4. Marico Ltd | 44.85% |
| 3. Ruchi Soya Industries | 12.07% |
| 5. Ajanta Soya Ltd | 61.04% |
ROE Ratio:
(It basically indicates the profit company is making from its equity invested)
| 1. Company’s ratio: Adani Wilmar | 23.90% |
| 2. Industry | 26.70% |
| 4. Marico Ltd | 33.97% |
| 3. Ruchi Soya Industries | 20.78% |
| 5. Ajanta Soya Ltd | 47.77% |
Positive Aspects:
- Over 65% of revenue comes from its Oil business.
- AWM has posted increase in net profit at the rate of 33.60%.
- Adani group as a whole has marked remarkable growth so far.
- Its flagship brand “Fortune” is the largest selling edible oil brand in India.
- Its CAGR is in par with its peers.
- Decreased borrowing over the years.
Negative aspects:
- Reduction in Cash Equivalent.
- Slightly overvalued when compared to industry’s & immediate peer’s ratio.
- Better performance than the indutry topper.
Disclaimer: This shouldn’t be construed as a stock recommendation, investors discretion is advised while investing.
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