Adani Wilmar Ltd (NSE: AWL) Q3 2025 Earnings Call dated Jan. 27, 2025
Corporate Participants:
Angshu Mallick — Managing Director and Chief Executive Officer
Saumin Sheth — Chief Operating Officer
Analysts:
Manoj Menon — Analyst
Abneesh Roy — Analyst
Harit Kapoor — Analyst
Latika Chopra — Analyst
Ashok Shah — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Hadani Q3 FY ’25 Results Conference Call hosted by ICICI Securities. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr Manoj from ICICI Securities. Thank you, and over to you, sir.
Manoj Menon — Analyst
Hi, everyone. It’s wonderful — good morning, good afternoon, good evening, depending on the part of the world you’re joining this call from. Representing ICIC Securities, it’s our absolute pleasure once again to host the results conference call of the company. This time it’s Q3 FY ’25. The company is represented today by Mr Ankshu Malik, Chief Executive Officer and Managing Director; Mr Kanhare, Deputy CEO and CFO; Mr Sheth, Chief Operating Officer and the team. Over to the management for the opening remarks, post which we will open the floor for Q&A. Thank you, and over to you, sir.
Angshu Mallick — Managing Director and Chief Executive Officer
Yeah, thank you, Manoj, and very warm welcome and good afternoon to everyone who has joined this call. As a ritual, what we will do is we will take you through a brief presentation on the performance of the company for the quarter three. The presentation is separately uploaded on the exchange, so you can also take your copies separately and go through the presentation. For the time-being, we will take you to the presentation. So we saw one of the best quarter since inception of the company, posting consolidated revenue for the quarter at INR16,859 crores with an underlying volume growth of 5%, EBITDA of INR792 crore and result in PAT of INR411 crores. This translates into 31% year-on-year growth in revenue, 57% EBITDA growth and more than 105% growth in PAT as compared to the same quarter last year. On the nine months ended 31st December ’24, revenue at INR45,488 crores, EBITDA of INR2,033 crore and PAT of INR1,035 crores grew by 20% and 161% in terms of revenue and EBITDA. Whereas on the PAT it is complete turnaround from loss of INR9 crore to the profit of INR1,035 crores as compared to the same-period last year. We have also been able to demonstrate improvement in metrics in the case of gross margins and EBITDA over the past quarters, primarily led by edible oil business as the food business continues to remain in investment phase and more or less EBITDA neutral given that it is still at a growth stage. Standalone numbers are no different from consolidated ones with revenue for the quarter at INR16,491 crores, EBITDA at INR782 crores and PAT at INR409 crore remains the best performance for the company since inception. Similarly, for the nine months ended 31st December ’24, we delivered revenue of INR44,235 crores with an EBITDA of INR2,022 crores, PAT of INR1,059 crores translating into growth similar to consolidated numbers. Per ton metrics on gross margin and EBITDA also remained similar to the trend we witnessed at the consolidated numbers. Normalized gross margins and EBITDA for the past five quarters are consistently improving. Q1 and Q2 of the last year, as we said earlier also, was an aberration due to hedge disalignment that Edible industry witnessed last year. Barring these two quarters and in particular, last five quarters margin structure have shown consistent improvement. Quarterly trend on per ton metrics for the gross margins and EBITDA are more or less range-bound except Q1 and Q2 of last year. EBITDA margins have — EBITDA margins about INR3,500 level in any quarter are suggestive of a commodity cycle gain that company has been able to crystallize. EBITDA per ton of 4956 for this quarter is also suggestive of the same fact. This quarter we saw gains on account of favorable positions and bit of inventory gains. On segment basis, edible Oil, Food and FMCG registered healthy volume growth of 4% and 23% for the quarter and 11% and 32% for the nine months ended 31st December ’24. Industry Essential segment degrew on volumes by 3% and 9% for the quarter and nine months period respectively. De-growth in Industry Essential segment is primarily due to lower deoil cake business, which is more of a parity driven business. Major constituent of industry essential business, Oleochemical continues to grow volume in double-digit and with a healthy margins. On margin front, edible Oil registered segment profit of INR571 crore and INR1,342 crores for the quarter and the nine months ended, which is one of the best for the segment. Industry Essential delivered a profit of INR82 crores and INR165 crores for the quarter and nine months primarily driven by and Castor business. Food and FMCG delivered a segment loss of INR46 crore and INR23 crores for the quarter and nine months ended 31st December ’24. This is primarily on account of loss in the rise inventory due to downward correction in the market. Any positive correction in the market from here will improve this number. Other than rice, all other food business such as wheat flour, basin, pulse, and soap business remained EBIT positive. Overall food and FMCG business more or less remained EBITDA neutral for the quarter and the nine months ended December ’24 EBITDA performance on all business segment for last four years shows a consistent improvement in edible oil. EBITDA has increased from INR1,532 crore in FY ’22 to INR2,375 crores in last 12 months. In our matured business of edible oil, we are generating a return on capital employed of close to 22% on the back of high turn of fixed assets. The food business, which comprises several products categories is currently in an investment phase and we target to have 20% to 25% of the in this segment as well. Our Soyana Gates and has already reached decent ROCE level. On overall basis, the company is delivering an ROC of close to 13% on trailing 12-month basis. This is how the ROCE and the capital employed fares as far as the last three years of trend is concerned, edible oil with 22% and industry essential at 10% giving last 12 month ROCE of 13%. We are consistently investing in food business. The fixed asset investment in the food has gone up from INR482 crores in March ’22 to INR1,328 crores as far as December ’24 is concerned. And similarly, the net working capital in the food business has also gone up from INR393 crores in March ’22 to INR1,461 crore in December ’24 and this is also reflective of the fact that now the food business is close to INR6,000 crore-plus when we look at a trailing-12 months of data. On a market context, overall market sentiments and edible oil remain bullish during the quarter. Prices of all major three oils, soya, sun and palm remained elevated as compared to the last quarter. Industry witnessed some downward correction in the prices in the later part of December, but still prices remained higher as compared to the past quarters, primarily due to-high duty imposed by the government in the month of September ’24. Throughout the quarter, palm remained costlier than sun and soya, which is a complete departure from earlier trends where sun and soya always used to command a premium over palm oil. This is quite concerning as palm remains one of the highest consumed oil in India and therefore any such trend will have a risk of inflation and trajectory on the food items including the demand for the edible oil. In both edible oils and wheat flower industry has been showing subdued growth in low-single digit for last five quarters. In wheat flour, rural has been growing in strong double-digit due to consumer shift in packaged wheat flour, whereas in edible oil for the quarter three, the industry grew by 5%, whereas rural grew by 8%. So overall, what we see is not a very encouraging demand from an industry perspective whether in the case of edible oil as well as wheat the company has been able to register a handsome growth on the revenue and margins for the quarter as well as for the nine months ended December ’24, one of the highlights of course in this entire performance is the alternate channel comprising of MFS, e-com and QCOM that is growing faster than a general trade and now contributes a sizable business with a trailing-12 months revenue in excess of INR3,000 crores. Similarly, channels, which we started a couple of years back continues to grow for us and is now contributing close to INR600 crore of business basic 12 months. In edible oil business, in-spite of high prices, we could register a single-digit volume growth led by soya sun and mustard oil. This volume growth could have been in single-digit at the palm could have been high-single-digit had palm prices remained below the soya and Sun. We witnessed cut in consumption by consumer due to-high pricing as a result, consumer pack in the industry grew only by 5% as per the Nielsen source as per the Nielsen. Our regionalization strategy in edible oil continues as we launched region-specific SKUs to cater to the local demand. In the food and FMCG business, we delivered yet another quarter of a sizable volume growth of 23%. The growth came on the back of all the food products showing sizably. On margins, the segment suffered loss due to inventory valuation loss in rice. We continue to consolidate our market-share in most of the food categories. ESG continues to be integral part of our entire ecosystem. Our flagship CSR program, Fortune that aims to curb malnutrition and anemia among the children, adults and girls and women in the reproductive age has won prestigious Indian CSR Award 2024 in the category of Best Children Healthcare Initiative of the year 2024. AWS Mundra and Hajira plant received gold medal and silver metal respectively at the 10th addition of India Green manufacturing Challenge organized by International Research Institute of for Manufacturing. Our Venisha factory, which manufactures soya nugates and soya value-added products earned a safety award for a global — at a global Safety Summit 2024. On Edible Oil, I think we have been steadily contributing to the volume growth quarter-after-quarter, which is reflective on the standalone EBITDA, which, which is we are delivering in this segment. The capacity utilization in this segment continues to be reasonably well, reasonably, reasonably, reason and 78% and 78% and which is suggestive of the fact that any future growth can be accommodated easily. On the market-share, we had a flattish market-share. We actually dropped by-20 basis-point on overall market-share from 18.3% to 18.1%, but the encouraging part of this entire story on-market share is that fortune market-share actually has gained. Similarly, we have gained market-share in particularly in the case of soya bean and. As far as the food is concerned, again, we have enough capacities in-place. The utilization of capacity is at 53%, whereas market story for wheat flower looks good, we have gained market-share gone up from 5.3% to 5.8% now. Basmati rice market-share has come down from 7.4% to 6.1 and clearly, there are work-in progress, particularly in branded rice, which company is working on. And we have put in-place a lot of interventions in this particular business. And as we go-forward, in couple of quarters, we should be able to see improvement in-market share as far as the rice is concerned. So on distribution front, we continue to work on growing it and now have a direct coverage of more than 8 lakh outlets and total reach of more than 2.1 million outlets. In terms of rural distribution expansion, we now reach more than 40,000 towns and have — which have got a population of less than 100,000 and rural saliency in our business remains at a close to 30% of our overall business. Alternate channel continues to — continues to be a good story for the company. This channel grew healthy 16% during the quarter in which e-com and grew by 41% and 81%, which is very encouraging for us. We are working closely with all the e-com players to see that this growth and market-share is sustained in future because as we go-forward, this is the channel which is going to cater to most of the demand coming in from the consumers who are demanding packaged staple food. One of our IPO project at Gohana, Haryana, which is going to be one of the biggest integrated food facility for the company is more or less completed. This is an ideal view of the facility which shows how the big this facility is, we have commenced the production at rice to rice and mustard oil facility and have achieved first commercial dispatch from this factory in January ’25. This integrated facility is expected to be fully operational by end of first-quarter of next financial year. The integrated facility houses production lines of paddy to rice, rice to rice, wheat flour, refined wheat flour, rice brown oil, mustard oil and cotton seed oil. This will be built with an overall capital outlay of close to INR1,300 crores which is majorly funded through an IPO funding we continue to do a lot of marketing campaigns whether it is on social media or BTL activities or TV activities and these are some of the glimpses of our engagement with the consumer on various mediums through which we connect to the consumers. So the key takeaway is finally this is the final slide from my side. One of the best quarter of course for the company since inception. We have been delivering consistent performance for last several quarters and have delivered best-ever operating EBITDA of INR2,390 crores on trailing-12 month basis, food and FMCG revenue of 6,000 plus in last 12 months and therefore, our target of reaching to INR10,000 crore by end of FY ’27 seems to be very much achievable. We have big lever for growth by increasing our distribution and we remain very bullish on emerging channels like e-commerce, branded exports and to fuel the kind of growth that company is looking at for coming years. And on ESG, as I said, ESG remains integral part of our culture. We participate in CDP and DJSI ratings during the year and are fully committed for a continuous improvement in the scopes. This concludes my presentation and we can now open the floor for the questions and we would be happy to answer the questions. Over to you.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press and one on the touchstone telephone. If you wish to remove yourself from the question queue, you may press R&2. All participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Abneesh Roy from Nuvama. Please go-ahead.
Abneesh Roy
Yeah, congrats on the profit. My first question is on the foods business. So you have called out strong growth in Soya nuggets apart from your other food segment. There we have seen incremental competition also from Marico Saffola and they also claim to be doing well. Could you talk about the competitive intensity here, pricing pressure, et-cetera? And if you could also talk about Sattu because that clearly seems to be a focus area by customers in terms of more protein specific product. So long-term, how do you see the organized market-share within Sattu because it’s largely unorganized currently.
Angshu Mallick
On, let me tell you that after COVID, we have seen the higher sales of plant protein or veg protein. Now soya nugates have 52% routine and doctors have recommended that for particularly for the vegetarian people, plus I have seen that non-vegetarian people also once in a week, they have accepted nuggets as integral part of the food. Now, we have — we have understood this business and in terms of technology, we first went ahead with putting technology. So all our plants are plant from US. We are the world’s best manufacturers of such products and we have that in and and now we have started Nagpur. So we are possibly the only people to have three locations of Nagget. And as you know, these are light products. So cost of freight is very, very important and we have that logistic advantage because we have soya, bean flower plant in Magpur with Isha and Haldi also we have our own packing station. So that helps us. Logistically, we are better-off. There is competition, but then that’s okay. Everybody is trying to enlarge the market and we see great opportunity. So very good to have healthy competition. No problem on that. Pricing front, we are — this is a very stable product and doesn’t need too much of pricing except once in a while you give some consumer scheme or trades promotion scheme. But by and large is a steady market. Same, 60% 65% sale comes from March to October and 30% 35% comes in the winter. That is how it is very in the market. On, let me tell you, is a — is a product which normally goes during in Eastern India and Eastern UP onwards, Bihar. So there we have Sattu and we have our plant — we supply from Delhi now, but going-forward, we can surely make in Haldi also. We have a plant in Haldia. So Sattu is one-product which also is seasonal a bit. In the summer, it does very well. Winter it reduces. So we are pushing it along with our products.
Abneesh Roy
So from a competition perspective in Soya Chang from Sapola, you aren’t seeing anything disruptive, right?
Angshu Mallick
See, first of all, they don’t have their own manufacturing base. They are getting it produced at some other factories. Now we see advantage for us that we have our own setup. We have ability to expand if required and that is what we have done. So we are the largest soya nugget producers now in India at 6,000 tonnes per month. So we have enough capacity to provide to the market.
Abneesh Roy
Sure, that’s very useful. My second question is on the branded rice, weak performance. So you have mentioned inventory losses there and supply-chain issues. So if you could address here because post the acquisition of the number three brand there, it has been a bit challenging post that. So here, could you have done something different to prevent the inventory losses or that’s part of the business, nothing much could have been done. But from a structural perspective, my question is, how do you start getting back the market-share because generally M&As in India, FMCG, we have seen, lot of them ultimately turned out to be very challenging. So if you could talk about your Basmati market-share, the journey in the next two to three years, how do you see that? Thanks.
Angshu Mallick
See, in Basmati, right, unlike the big players, we did not have our own plant. We had only one plant in, Punjab and in Haryana, which is the main area for Basmati, we used to work under the toll arrangement. Now these toll arrangements have a limitation to the processing capabilities as well as capacities. Now we have been waiting for our Gohana plant and because we were doing in the tolling, obviously, there was lot of stocks to be moved from one place to another to consolidate dispatches. But now that Gohana plant has just started operations, the most important part is that in Gohana, we have almost 600 tonnes per day per day and 500 tonnes of rice per day capacity, which is very big enough for us to use it. And we have very large storage capacities there. So it will be useful for us to have a consolidated production base as well as dispatch base. Once that happens, the logistic issues, the fill rate and the challenges of yield or quality, all that gets a large extent settled and then we can concentrate in-building the brand and distribution. And you will agree with me that e-commerce, modern trade alternate channel is 50% of the branded basmati rice consumption. So unless you are good in-fill rate, unless you are good in supply-chain for these products, the alternate channel doesn’t do well. Now that with coming up, our supply-chain will become much more stronger and we are confident that we’ll get back to share. I’m sure in next two quarters or 3/4, you will find that our shares have gone up.
Abneesh Roy
Sure. Last question, that’s my last question. On the palm oil, what will be your understanding in terms of pricing because it went up sharply by almost 30% and from top, it has corrected 10%, 15%. So what will be your understanding of pricing, no one can Call-IT out. I understand it’s a commodity, but what will be your understanding? And on the 20% duty, duty which government had put, is there any thing — expectation that in the near-term this could get corrected? Any discussions on that?
Saumin Sheth
Hi, Salveen here, hi. So on the pricing, it has become a very political product both for Indonesia and Malaysia. Their biodiesel program is important than the food demand. Yeah. So as you rightly mentioned, the prices actually were higher by 50% to 20% compared to the other soft toils. Now the market is correcting, the spread is reducing and this biodiesel program of Indonesia, whether it is B40 or eventually it will only remain to be 35%, B-40, prices will also fluctuate in-line with the policy. On the duty is anybody’s guess, government after a long way to increase the duty to support the Indian farmers, unfortunately today also beans are trading way below the MHP. So it — I mean you can Call-IT 50-50, whether they can reduce the duty or not. Their priority probably is these farmers and the consumers.
Abneesh Roy
. Sure, thanks. That’s all from my side. Thank you.
Operator
Thank you. The next question comes from the line of Harit Poor from Investec. Please go-ahead.
Harit Kapoor
Yeah, good afternoon. Just a few questions on the numbers.
Operator
So request your handset, sir, your audio is slightly muffin. Hello.
Harit Kapoor
Yeah, is it better?
Operator
Yes, sir. Please go-ahead.
Harit Kapoor
Yes. So just a few questions on the numbers. I just wanted to — if you could just quantify the employee cost impact on account of the ESOP for the quarter? And just a sense of how this works? Is it a one-time in this quarter or — and what is the future impact on the employee expense, if you could just give some sense on that?
Angshu Mallick
Yeah. So I can understand from where you’re coming from because employee cost has gone up quite substantially in this quarter. But this impact is not exactly on the ESOP because ESOP we declared only in the month of December. So the real impact of ESOP may start coming in from the next year, not from this year. So right now, the employee cost which you see, which has gone up as compared to the last year and of course on the Nine-Month basis also is basically because of the one-time incentive provision that we have made, given the fact that company this year is going to be going to declare one of the best results and therefore, our policy provides for additional incentive which have been provided on a proportionate basis for this nine months. So that’s the reason why the employee cost has gone up and this is of course only a one-time and it — and then for the modeling, I don’t think you can consider it for the next year and next quarters.
Harit Kapoor
Got it, got it. And secondly, on even on the other expenses bit, if you look at sequential numbers are quite high, I understand that this is INR70 odd crore MTM there on the derivative side. But even adjusting for that, it looks slightly on the higher side. So I just wanted to get your sense, is it more to do with Ghana operationalization or what would explain that kind of sharp 30% plus growth?
Angshu Mallick
So no, it’s not basically anything to do with the Gohana operationalization because Gohana, as I said, we just dispatch one commercial cargo from the — from the complex, I think the entire complex will get commissioned only in the next quarter — sorry, first-quarter of the next financial year. So this other expense has hike is again it’s a kind of one-time where the hike is due to one is of course, derivative impact and the ERD impact. And both these impact actually somehow get recovered from the — either through from the revenue or either sitting in the inventory gain. So there is a impact of this spend which you are seeing more. Besides that, there is a onetime some marketing provisions have been taken. So if you normalize those, these expenses have actually gone up in tandem with the volume growth?
Harit Kapoor
Yeah. Okay, understood. Understood. And sir, how do I look at — how do I look at the — the inventory gain which sits out of your — in your — in your gross profit either for the full — for the nine months or for the — for the quarter. What do you think would be a more normalized level? And the second point is with the prices having corrected a little bit in Jan, do we expect some of these inventory-led gains slightly to reverse, not reverse, but be a little bit of a reduction there in-quarter four? How do I kind of read this and build it out?
Angshu Mallick
Yeah, I would not Call-IT an inventory grain, rather I would say this quarter numbers do have one-time impact of the commodity cycle again, rather, I would say when I say commodity cycle, again it includes both inventory as well as better positions, which have turned positive for us. And therefore, the numbers for this quarter are more or less consistent with what we have been declaring for past couple of quarters except for this one-off one-off — one-off inventory — one-off commodity cycle gain. So our normalized EBITDA as we are saying earlier also is anywhere in the range of INR3,500 crores INR3,600 crores and anything above that is suggestive of the fact that we have witnessed a commodity cycle gain in that particular quarter or period, maybe which may be six months or nine months?
Harit Kapoor
Very clear. And just on the direct reach side, you know, if you look at — if I just look at a period of time or a quarter where you’ve seen the highest kind of move quarter-to-quarter in-direct reach, I think Q3 or December quarter is one of the — the addition is almost 50,000, which is a pretty, pretty substantial number. Just wanted to get your thoughts on what is the kind of three year, two-year, three-year target here. We’re already at 8.2 lakh outlets. How do we — how do we think about a two-year, three-year kind of target on direct reach expansion?
Angshu Mallick
And we have taken a target to exit FY ’27 at 1 million direct coverage.
Harit Kapoor
Got it. Got it. Okay.
Angshu Mallick
So we have that much distance to travel and some of the quarters it is fast, some of the quarters it is a little slow. Say, Q1, you will find it is little slow because of the summer time and heat and all that. But then wintertime generally the work timings are much bigger and we — people travel more, people work more. And so we get more outlets on it.
Harit Kapoor
And from a portfolio level on the edible oil side, if you could just give a sense of you know what has done well, what has been weak? I mean you know mix between say palm, soya, the key oils for you, where have you seen strength in growth, where have you seen a little bit of weakness, you know branded versus unbranded, a little bit more color on that in this quarter, given that the price fluctuation has been quite material.
Angshu Mallick
Okay. To sum-up the edible oil business, you see in-home and out-of-home consumption. So look at in-home consumption, it is by and large a driven by two main oil, that is sunflower oil and soyabean oil and the domestic oil is mustard. These three oil forms actually the core of the household consumption. Every house will have one refined oil and one unrefined oil or taste oil. So mustard is normally consumed in east, north and part of Central India and will be a little bit of Western India and Southern India. Now cotton seed oil is also a good oil, 1 million tonne, 1.5 million tonne, but consumer tax are in the 0.5 million ton that is in the western part of India, that is Gujarat, little bit of Maharashtra and little bit of Pradesh. These oils form the main core household consumption. Now when you go to out-of-home consumption, palm is a big out-of-home consumption because normally the restaurants and and all that they prefer pump. Baking industry, industry and snack food industries prefer pump because that gives them a better shelf-life and neutral taste. So palm prices going up, obviously, they — some of them shifted to rice brand oil, some of them shifted to cotton seed oil because these oils were as competitive as farm or cheaper than palm. But then once the palm becomes cheaper, they will always switch-over to palm. Out-of-home consumption is 30% 35% and 65% is in-home consumption. So that is how it is actually divided. Since we have a basket of oil, that is we have ground oil, we have cotton seed oil. So we have that advantage of seasonality, location advantage and price advantage at anything that is cheaper, we are always there. So we are there in rice brand oil also. So that is our advantage. And so that is how the business of edible oil is.
Harit Kapoor
Okay. Okay. And on the last question I come back for more was on the food and FMCG side. So say if I had to strip out the losses from the rice inventory, what do you think would have been more a normalized number for food and FMCG, if I just had to hazard the guess.
Angshu Mallick
The inventory loss right now sitting in this number, which is again this time we have taken given the fact that market has corrected downward is close to INR50 crores. So if we normalize this, I think we have been consistently declaring the EBIT of food positive. So it would have been in that range more or less with what we have been showing for past couple of quarters.
Harit Kapoor
Got it. And last question was on rural. So it’s a very interesting slide on industry growth trends, retail consumption and rural volumes in the last 3/4 in edible oil actually have accelerated and even wheat flower, you’ve seen a sharp increase as you mentioned, this is all conversion led. So just what’s your view on what’s happening in rural markets? Is it a slightly better incomes over the last 3/4, which are driving this conversion to an organized category growth, just your own kind of hypothesis on what’s happening here?
Angshu Mallick
And see rural was almost in stagnant between last year, say, December to this year, June, July. Only after good monsoon this year, we saw the rural consumption pick-up and good consumption, good response we saw only after September. So September onwards until now also, we are finding rural is a lot to lot extent it is back-in action. Urban stress continues and we can see that urban consumption is stretched. And second, inflation is hitting somewhere both the rural and the urban. In rural, it has not been to that extent, but in urban, we can see that very, very clearly. So if you ask me, rural has started coming back-in terms of demand and all that. Pack food is doing well and we see small pack demand is increasing one kilo, two kilo packs, half a kilo basin. Nuggets also doing well in rural market. Sugar is doing well, 5 kilo, one kilo. So rural overall has started giving that indication of coming back to action. More will depend on how government intensifies the rural.
Harit Kapoor
Got it. That’s it from me. Thank you, sir. Thanks.
Operator
Thank you. The next question comes from the line of Latika Chopra with JPMorgan. Please go-ahead.
Latika Chopra
Hi, thank you for the opportunity. I have couple of questions. Let me start with edible oil. You had a volume growth of 4%. You called out that the branded sales declined low-single digits and it seems the demand environment as we explained and the price differential of farm overtaking the other oils, you sounded a bit cautious. Now with the oil price index kind of moderating, how should one think about your overall volume growth for edible oils? And also how do you think about the possibility of volume growth sustaining at mid-high single-digit level over the next couple of years, given your distribution initiatives.
Angshu Mallick
The edible oil demand — so the industry always used to grow in a range of 5%, 6% and so while the palm remains one of the one of the highest usage oil in India and therefore a correction in palm oil downward, of course, will give some boost to the demand in coming quarters. Our expectation to answer your question straight, the demand for the packaged edible oil should — I mean, the industry should keep growing within the range of 6% to 7%. And our growth of course we feel that we should be able to grow at 8%, 9% kind of number so that market-share keep consolidating from here.
Latika Chopra
All right. And the second thing is on realizations. This quarter, there was a massive increase because of the increase in palm oil prices. Do you — just trying to think in terms of the pace at which you change prices depending on your raw-material sourcing. So do you anticipate these firm levels to stay at least in the current quarter before probably coming in-line with the market price in the next quarter. So just trying to think through what is the lag with which the pricing will follow in your numbers.
Angshu Mallick
See the palm prices have moderated in the last week of September, but it keeps fluctuating. So like today the complex was again up because of some geopolitical factors and then tomorrow it may go down. But what our expectation is that the level which we have seen in the month of January will continue to play at least for this quarter. Having said that, it’s very difficult to comment how it will fare in first-quarter of the next year, but at least for this quarter, the prices should remain at what level which we are looking at. So from a realization perspective, more or less same as what we have seen in January.
Latika Chopra
All right. And can I then check on your profitability metrics, EBIT per metric ton because you know considering the pricing fluctuates and I’m sure you want to maintain a certain threshold of profitability on per unit basis. This quarter, it is coming to about 500 odd levels per metric EBITDA, I’m just talking about edible oil and on nine months basis, this number is roughly 4,500. When you gave a number of 3,500 to 3,700, is this the number you were referencing to? I’m just a little confused. I thought I’ll just clarify. Is that the more nominal range of profit per metric ton for edible oil?
Angshu Mallick
No, no, not so when I give you a range of INR3,500, INR3,600 is a blended at a company-level, which includes all the business segments particularly. And therefore edible oil, it could be suddenly different than, 3,500, 3,600.
Latika Chopra
And what would that range be sir for edible Oil? Because even in this quarter, you had about 3760, right?
Angshu Mallick
For — see, for edible oil, of course, it would be little bit higher than because as we said food remains EBITDA neutral for us and EBIT neutral for us as well as the industry essential, it’s more of a downstream of edible oil only. So of course, the edible oil EBITDAs would be little more than INR3,500. It would be in the range of INR3,750 to INR3,800 because that’s how when you look at a blended level, you get an EBITDA of INR3,000 normalized EBITDA of INR3,500 levels at the company-level.
Latika Chopra
So this is EBITDA you’re talking about.
Angshu Mallick
I was.
Latika Chopra
Okay, okay. No, EBITDA
Angshu Mallick
. Okay, EBITDA.
Latika Chopra
Fair enough. The other question I had was on food and FMCG. Any broad thoughts on — with this new capacity coming up, how should one think about your volume growth aspirations for and also any flavor on medium-term margin outlook or aspirations that you have? Thank you.
Angshu Mallick
See, we have said earlier that food and FMCG, we wish to continue at an average growth rate of 20% plus. Now looking at that goal, we need to add capacities which are surely World-class and can give best products at the most efficient processing cost. So we are investing and these are integrated plants where we have multiple products. So that helps us in buying, processing and supply. That is one. Two is that these capacities will surely add Gohana at its full stream when it runs full and even at we take 80%, 85% capacity, it should give us a volume of around 6 lakh 25,000 tonnes per annum food and oil put together where food will be made, oil will be around 200,000 tonnes. So we expect Gohana to add help us in enhancing volume, reduce our cost as efficiencies will pour in with the integrated operations. Third is that because we will have integrated plant, our dispatch delivery, all the cost to our distributors will become cheaper. And all those benefits will surely be seen in our performance.
Latika Chopra
Sure. And can I just check one thing. When you look at the pricing for your food and FMCG products and you benchmark it to whoever the competitor is in each of the categories, and I’m sure there will be variations on an on a statewise basis, yes, QY cases. Has the differential reduced over-time as you’ve built-in more efficiencies?
Angshu Mallick
Yes, I would say. You take an example of that is one of the earlier FMCG food product that we started. And we had only one national competitor, which you are aware of. Now obviously, when you compare with that competition, you keep the prices lower and you start to see your main competitor and then work around. Slowly that happened, but as we progressed, our products were surely a better in terms of technology and we knew that we can give a better product with better distribution. We were slowly getting into higher pricing. And today we are surely priced equal or many places we price it higher than the nearest competitor. So that happens. Second, you take Besar. Besar, you don’t have a national player. So obviously, when you look at Delhi, you have a competitor, so you price it with that competitor or in Bengal, you have a competitor Europe. But rest of the place where there is nobody to compete with, we go all-out and we price better. And because we are the leader there. So whether it is Bihar,, Mr rupee, all these markets, we are the leaders and we price it versus the brand premium?
Latika Chopra
Sure. And last one on this, Mr Malik was when you look at food and FMCG, how do you think about further additions to your portfolio? Would you want to do pulses at-scale or not or you would like to focus on scaling up-market shares in-basin and some of the other broader big category segments that you’re already in.
Angshu Mallick
See, when you talk of, we have — we know that Channa Dal or Channa is almost 50% of the India’s consumption. Almost 10 million ton is the normal domestic production. So we have put three new plants, 240 metric tons per day-in Magpur, Nimach and Kari in Ahmedabad, outskirts of Ahmedabad. These are state-of-art Channa processing plants. And with that, we will possibly become the largest Channa processors in the country. And we have matching based on with that 150 tonnes per day-in each of the units. So total — today we have four such units in the country. So Dal becomes important for us because whatever dal is coming out, almost 5,000 tons, we have extra for selling per month. So we will have to sell Dal in brand or in consumer tax. So that way we are progressing. Rice, we are putting out such a large unit. Obviously, we are thinking of an improving and increasing our pace, both domestic and exports. Ata, we are putting big plants and next year also we plan to have bigger capexes. So big, we want to be a reasonably a large player in this category. So in each of the categories that we are going, we want to be in the top three surely and maybe one and two number position for each of these.
Latika Chopra
Understood. And I think I asked this earlier, but any margin aspirations in food and FMCG, EBIT margin aspiration or anything you would like to share over the medium-term?
Angshu Mallick
No, I think this is what we have been saying for some time. I think food will remain in the investment or a growth stage rather, I would say till FY ’28. And therefore, the EBITDA margins for the food ideally should only start growing after FY ’28. But having said that, it’s not that by — we would certainly not want this to grow, but yes, until and unless we get to the level of market-share and the volume share that we are — we have envisaged, I think this will remain an EBITDA neutral. But as we go-forward, post FY ’28, certainly we have a market discovered benchmarks available for rice and wheat flower and basin. I think we would certainly want to go to those levels. For example, for example, in rice, we have — we have market players who have been able to showcase our gross margins of close to 25% EBITDA of 10%. Similarly in wheat flower, we have seen the biggest player in the country. As per our estimate making an EBITDA margins of close to 6% to 7%. But for us, it is a story of next three to four years to reach to that level.
Latika Chopra
Understood. Thank you so much for patiently answering all the questions. Wish you the best.
Angshu Mallick
Thank you.
Operator
Thank you. A reminder to all participants, you may press star and one to ask a question. The next question comes from the line of Ashok Shah from Invesco Family Office. Please go-ahead.
Ashok Shah
Thanks for taking my question. Yeah, sir. Sir, do we have any thought to tie-up with the farmers to grow pump trick in India as the is a leader involved.
Angshu Mallick
Yeah, Mr. No, as of now, we do not have any palm plantation in India.
Ashok Shah
So we majorly procure palm from the — our system concern or the international where we grow the palm treat.
Angshu Mallick
Yeah, we are procuring all the palm from Malaysia, Indonesia and other countries mainly from Sister and also from other ABCD of the palm players.
Ashok Shah
And how much we consume palm oil to make nuggets and any other products see
Angshu Mallick
Nugget sees a different raw-material altogether. Nugget is actually non-GM soya beans and its derivative and palm is mainly for the edible oil and the other value-added specialty.
Ashok Shah
Thanks. Thank you. That’s all from my side.
Angshu Mallick
Thank you.
Operator
Thank you. Ladies and gentlemen, that was the last question for today. I will now hand the conference over to the management for closing comments.
Angshu Mallick
Yeah. So thank you very much everyone for joining the call, taking out time and listening to our story. Keep connected with us. And thank you again. We wish everyone a very good evening and thank you. Thank you. Thank you all for attending you. Thank you.
Operator
Thank you. On behalf of ICICI Securities, that concludes this conference. Thank you for joining us and you may now disconnect your lines.