Adani Wilmar Q4 results preview: Profit may jump over 100%; sales degrowth likely

Adani Wilmar Ltd is all set to declare its March quarter results, along with two other Adani group firms including Adani Power Ltd and Ambuja Cements Ltd. Nuvama Institutional Equities expects sees doubling of Adani Wilmar profit on a single digit de-growth in sales.

Nuvama estimates Adani Wilmar profit at Rs 217.60 crore against Rs 93.60 crore in the same quarter last year. The Adani firm reported a profit of Rs 200.90 crore, down 18 per cent YoY, in the December quarter.

Nuvama sees Q4 sales for Adani Wilmar at Rs 13,314.40 crore down 4 per cent YoY from Rs 13,872.60 crore in the same quarter last year. Sequentially, sales growth is seen at 3.8 per cent. It expects Ebitda to rise 43 per cent YoY to Rs 513.10 crore for the quarter against Rs 358.80 crore in the same quarter last year. Ebitda margin is seen at 3.9 per cent against 2.6 per cent.

The edible oils business contracted 4 per cent YoY in value terms due to price cuts in edible oils given softer raw material costs. The Food & FMCG business grew 18 per cent YoY (aided by Kohinoor) while industry essentials suffered a double-digit decline, Nuvama suggested.

Ebitda margin may improve 126 bps YoY, but would stay flat sequentially, Nuvama said..

In its provisional update for Q4, Adani Wilmar said it saw double-digit growth in both edible oils and foods businesses in the quarter, driven by increased retail penetration, particularly focusing on under-indexed markets. The company benefited from the strong demand during the festive occasion of Holi and the ongoing wedding season, Adani Wilmar said.

The Adani firm said it also achieved its highest ever volume during the quarter and it continues to gain market share. That siad, a significant decline in the export business of animal feed dragged down the overall volume growth to 4 per cent YoY in Q4’24.

"In recent quarters, the company has made significant improvement to its distribution infrastructure in the southern region. Regional marketing communications and other interventions have resulted in the gaining market share in Sunflower oil. With the increased digitalization of sales function, the company has improved its agility in making decisions for dynamic pricing in the local markets," Adani Wilmar said.

Although Adani Wilmar has been doing well over the years in terms of market share across categories, there is a near-term risk from local players owing to commodity deflation in edible oils, Nuvama warned.

Adani Wilmar will keep using regional approaches to push deep penetration, Nuvama said.

In its update, Adani Wilmar said the revenue from branded products in the domestic market has been growing at 30 pr cent YoY or higher for the last ten quarters. In Q4, the segment’s revenue grew 18 per cent YoY driven by domestic sales, despite the negative impacts of the continued export restrictions. In strong markets of edible oil, the Food segment is leveraging the outlet penetration to drive its growth, Adani Wilmar said.