Adani Wilmar‘s share price jumped back in the green on Thursday after the company posted its business update for the quarter ended June.
What Happened: The Adani Group company reported a 25% year-over-year increase in sales volumes in the June quarter on the back of “robust consumer demand.” However, the company’s sale value declined 15% YoY due to the sharp decline in edible oil prices. Edible oils account for the majority of the company’s business.
As per the company, the edible oil business grew by 25% YoY in volume terms during the quarter on the back but value declined by around 15% YoY. The company also revealed that the Food & FMCG segment recorded a revenue growth of 30%+ YoY to cross ₹1,000 crores of revenue for the quarter on a standalone basis.
Talking about the slump in edible oil prices the Fortune Maker said that the prices of edible oil have experienced a decline of over 50% in less than a year. But the company’s strong risk management framework has effectively minimised the impact of these price drops on our gross profits to a considerable degree.
However, maintaining high-cost inventory in a market where prices are falling has put pressure on our profitability throughout the previous fiscal year, and this trend has continued into the June quarter, the company added.
Get Ring The Bell, Benzinga India’s weekly briefing. Designed specifically for investors like you.
Price Action: Adani Wilmar’s share price was up 0.71% to trade at ₹409.85 in the early hours of trading on Thursday.
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.