Amul to tap 700 small towns

Rapid expansion to be the organisation's mantra for 2013-14, says Chairman

Gujarat Cooperative Milk Marketing Federation (GCMMF), which markets the famed ‘Amul’ brand of milk and milk products, aims to get into 700 small towns for the first time this financial year. And, double its export. Vipul Chaudhary, chairman of GCMMF, said: “Rapid expansion will be the mantra for 2013-14.”

Milk procurement, he said, had risen 20 per cent in 2012-13 to 13.1 million kg, the outcome of a 63 per cent rise over four years in what was paid to farmers. The aim is to raise procurement by another 14 per cent in 2013-14. Farmers are currently paid at the rate of Rs 487 per kg of fat in the milk.

On the proposed expansion in geographical reach, R S Sodhi, the managing director, said: “It would be pan-India. We are targeting smaller markets, with a population (each) of 25,000-50,000 people.”

Amul is already present in around 3,500 small towns. In 2012-13, the co-op says its got into 1,200 new geographical markets, adding 306 new distributors, 65 new super-stockists and 900 new sub-stockists.

It is also expanding processing capacity. "We currently have milk processing capacity of around 16 million litres a day and have taken up expansion work at various places, including opening of new dairies at Faridabad, Kanpur, Lucknow, Rohtak, Kolkata and Saurashtra. We plan to take the processing capacity up to 20 million litres in 2013-14," Sodhi added. This is part of GCMMF's plan to invest around Rs 3,000 crore to open nine processing units over three to four years. Around a third of this investment has been made already. The other plan is to expand export. Shipments were Rs 95 crore in 2011-12 and grew to Rs 140 crore in FY13. "We are aiming to more than double the export turnover to Rs 300 crore (in FY14)," said Sodhi. Shipments go to around 40 countries, including the US, New Zealand and West Asia, beside Bangladesh; Russia is a newer market.

GCMMF's turnover for 2012-13 was Rs 13,735 crore, up 18 per cent compared to Rs 11,668 crore the year before; net profit was Rs 35 crore. Chaudhary said the turnover aim was  Rs 17,000 crore in 2013-14.In individual brand sales values during FY14, the long-life UHT milk grew 53 per cent and Amul cream by 57 per cent. The milk beverage range grew 27 per cent. In ghee, the Amul & Sagar brands together grew 31 per cent. Amul butter and cheese grew 18 per cent and 19 per cent, respectively. Amul ice-cream grew 21 per cent and is, says GCMMF, the largest selling brand in the country.