In a plan to become one of the top three companies in the edible oil business, the Kolkata-based Emami Group is looking to acquire production capacity in one of the northern states. It is also embarking on a Rs 700-crore expansion plan.
“We are looking for an acquisition in, preferably, Rajasthan,” said Aditya V Agarwal, director. Emami will have to follow an aggressive strategy to find a place in the top three, currently dominated by Adani Wilmar, Ruchi Soya and KS Oils.
It produces 1,600 tonnes per day (tpd) of edible oil in its Haldia (West Bengal) plant, being expanded to 2,800 tpd at an investment of Rs 250 crore. The company has launched various categories of edible oil (mustard, soya, sunflower, etc) in Karnataka, Tamil Nadu, West Bengal, Bihar and Orissa under the ‘Healthy and Tasty’ brand. The product is in the process of being launched in Andhra, Madhya Pradesh, Chhattisgarh, Uttar Pradesh and Jharkhand.
A new unit is being set up at Krishnapatnam in Andhra with an investment of Rs 200 crore. This will have a refining capacity of 1,200 tpd. The company is also actively considering setting up a port-based unit in Gujarat. “This could have a capacity between 1,000-1,500 tpd and will require an investment of around Rs 250 crore. A final decision on this will be taken in the next couple of months,” Agarwal said.
India’s annual per capita consumption of about 12.7 kg is well below the world average of 20 kg, providing growth opportunities for the industry, points out a recent Rabo India report. Non-packaged oils are estimated to account for nearly half of consumption in both urban and rural markets. However, the development of the retail sector in India, backed by rising income levels, has provided an opportunity to sell branded packs, especially in the urban markets. The branded segment is growing at 20 per cent annually, with sunflowers and soy oils leading the market.