Adani Wilmar shares gain 1%; reports strong double-digit volume growth in Q2

Shares of Adani Wilmar rose 1 percent in early trade on October 6. In its Q2 business update, Adani Wilmar reported strong double-digit volume growth as rural sales have seen an uptick. However, in spite of growing volume, the value of sales declined on a year-on-year (YoY) basis. For the second fiscal quarter in FY24, Adani Wilmar's edible oil segment saw a 5 percent volume growth YoY, but the value growth slipped 19 percent. In Q2, the segment contributed around 74 percent to the company’s standalone revenue.

The food & FMCG business saw a volume growth of 18 percent and a value growth of 25 percent year-on-year. The growth was recorded despite a decline in exports revenue on rice export restrictions. On an LTM basis, the revenue for the food and the FMCG segment is around Rs 4,300 crore.

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The value growth of industry essentials was only 1 percent, despite a 25 percent rise in volume growth YoY. Combined, industry essential and food and FMCG segments contribute 26 percent to Adani Wilmar's business mix in terms of value.

As a result of modern trade and e-commerce, Adani Wilmar saw high rates of growth in oil and foods. Due to the changing spot and future prices of edible oils, the company reported that the "profitability for the quarter remained under stress."

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