April 6, 2015
Indian dairy Amul reports slowest growth in 8 years
India's largest dairy brand has reported its slowest growth in the past eight years for 2014-15 due to a slump in global milk prices that impacted bulk commodities such as skimmed milk powder, whole milk powder and ghee.
"The consumer product line has grown by 21% especially in the beverages, small milk powder pouches and ice-cream," Amul's managing director RS Sodhi told the Economic Times. He however added that the company saw a 77% drop in revenue in sale of bulk commodities.
The total turnover of the Amul group, owned by close to 3.2 million farmers from 17 district cooperatives, including sale of liquid milk by member unions, other dairy products and cattle feed in their respective districts, is estimated at almost Rs 29,000 crore (US$4.67 billion), Sodhi said.
The company which processes 15.4 million litres of milk procured from Gujarat and other states daily, is focussing on expanding its plant capacity by 14% to process 17.5 million litres of milk per day.
"With the current expansion in setting greenfield projects and expanding existing units, we should achieve a turnover of Rs 25,000 crore (for Amul brand) in 2015-16," said Sodhi.
To expand its export market, which slumped by 53% to Rs 250 crore in 2014-15, Amul plans to focus on the South Asian Association for Regional Cooperation (SAARC) and Middle East countries. "Pakistan, Afghanistan, Middle East are good markets to expand. Apart from bulk commodities, branded Amul products are also in demand in these markets," said Sodhi.
Within India, the company plans to add 1,000 retail outlets during the current fiscal year, taking the total number of exclusive parlours across the country to 9,000. In addition, to expand its distribution network, it will add 900 wholesale distributors this year to the existing 4,800.