Shares of FMCG major Adani Wilmar gained over 3% in intraday trade on Monday after the edible oil manufacturer announced a reduction in cooking oil prices by up to ₹30 per litre to pass on the benefit of falling global prices to its consumers. The company, which sells its products under the Fortune brand, has made a maximum reduction in soyabean oil. The fresh stocks with revised prices will reach the market soon. This is the second rate reduction in the last two months after the company cut edible oil prices by up to ₹10 in June, following a slash in import duties on the import of crude soyabean oil and crude sunflower oil by the government.
"In continuation to the global price reduction and the government's effort to pass on the benefits of reduced edible oil prices to consumers, Adani Wilmar has further slashed edible oil prices from last month's reduction effected by the company," says the company.
"We have passed on the benefits of global price reduction to our consumers and the stocks with new prices will reach the market soon," said Angshu Mallick, MD & CEO, Adani Wilmar.
Adani Wilmar, a 50:50 joint venture between billionaire Gautam Adani-led Adani group and Singapore’s Wilmar group, announced a price cut a week after the food ministry asked edible oil manufacturers to further bring down the maximum retail price (MRP) of imported cooking oils and maintain a uniform MRP of the same brand of oil across the country.
The food ministry held a meeting of all edible oil associations and major manufacturers on July 6 to discuss the current trend and pass on the benefits of falling global prices to consumers by reducing the MRP.
As per the company, Fortune soyabean oil will now cost ₹165 per litre from ₹195 per litre earlier, while the price of sunflower oil has been revised to ₹199 per litre from ₹210 per litre. The MRP of Mustard Oil has been cut to Rs 190 per litre from Rs 195 per litre, while Fortune rice bran oil price has been lowered to ₹210 per litre from ₹225 per litre.
Similarly, the MRP of groundnut oil has been revised downwards to ₹210 per litre from ₹220 per litre, while the price of Raag vanaspati has been slashed to ₹185 per litre from ₹200 per litre and that of Raag palmolein oil to ₹144 per litre from ₹170 per litre.
Reacting to the news, shares of Adani Wilmar (AWL) gained as much as 3.2% to hit an intraday high of ₹639.70 on the BSE. Finally, the stock settled day’s trade at ₹623.30, up 0.56%.
Adani Wilmar and Ruchi Soya are the largest players in branded oil business, contributing 12% and 6%, respectively, in total oil consumption of 22MT in India. The combined share of the top six players in branded oil business (Adani Wilmar, Ruchi Soya, Emami, Cargill, Bunge and Marico) has been estimated at around 40% in FY20.