MUMBAI: Packaged foods giant Adani Wilmar Limited (AWL) has developed an appetite for acquisitions, the latest one being for GD Foods Manufacturing, a privately held maker of kitchen foods and ingredients.
It informed the Bombay stock exchange through a regulatory filing today of its plans to acquire the company which is the maker of the popular Tops brand of sauces, pickles and other food products. It informed the bourse that it has signed a share purchase agreement (SPA) to acquire 80 per cent of its equity capital at a price per share based on an enterprise valuation of Rs 603 crore.
The acquisition marks a significant step in AWL’s strategy to diversify its product portfolio beyond edible oils into higher-margin food categories.
The deal aligns perfectly with AWL’s ambition to strengthen its position in the branded foods segment. GD Foods, with its Tops brand, generated Rs 386 crore in revenue for FY24, growing at an impressive 15 per cent CAGR over the past three years. The company offers more than 80 products across eight plus categories and has established a strong presence in north and central India with over 150,000 retail touchpoints spanning 15 plus states.
Key synergies from the acquisition include: * AWL will significantly enrich its offering with high gross-margin products while maintaining focus on kitchen essentials. * The acquisition brings another strong brand to AWL’s kitchen essentials category. * GD Foods adds new product categories with limited competition from national players, particularly in sauces where Tops is the No 1 brand in culinary sauces and No 3 in tomato ketchup in North India.
AWL plans to unlock value through its robust sales and distribution network. Its deep partnerships with modern retail channels, including quick-commerce platforms, will benefit the Tops brand. The acquisition will expand Tops’ reach into rural markets using AWL’s established infrastructure, says the latter.
North India, which is Tops’ core market, is also AWL’s strongest region, creating immediate synergies. AWL will leverage its pan-India presence to introduce select Tops products to new markets The combined entity aims to capitalise on AWL’s strong partnerships with organised retailers.
AWL will initially acquire 80 per cent of shares from existing promoters, with the remaining 20 per cent to be acquired in phases over the next three years at a pricing formula agreed upon in the SPA. The existing promoters will continue to support the business transition, and GD Foods will operate as a separate entity. The acquisition will be funded through internal accruals and IPO proceeds (if applicable), with completion targeted within 60 days, subject to customary closing conditions, said AWL.
The deal comes as India’s packaged foods market is showing tremendous growth potential, with significant headroom for branded products to gain market share from the unorganised sector.
* Edible Oils: Rs 2.0 lakh crore market with 75 per cent branded product penetration * Wheat: Rs 1.5 lakh crore market with only 12 per cent branded product penetration * Rice: Rs 2.1 lakh crore market with just 11 per cent branded product penetration * Pulses & Besan: Rs 1.2 lakh crore market with merely 5 per cent branded product penetration * Sugar: Rs 0.6 lakh crore market with 6 per cent branded product penetration * Spices: Rs 1.4 lakh crore market with 18 per cent branded product penetration
For both companies, this strategic move represents an opportunity to combine complementary strengths: AWL’s manufacturing excellence, widespread distribution network and financial might paired with Tops’ strong brand equity, innovative product range and market leadership in specific categories. AWL currently has impressive scale with: * Packaged staple foods revenue of approximately Rs 37,000 crore (as of Dec’24). * Household reach of 121 million * 2.1 million retail touchpoints * Edible oil division with last twelve months (LTM) Dec’24 revenue of Rs 45,208 crore. * Food & FMCG division with LTM Dec’24 revenue of Rs 6,150 crore. * Industry essentials division with LTM Dec’24 revenue of Rs 7,369 crore.
Tops brings several valuable assets to the table: * Diverse portfolio spanning sauces, condiments, meal preparation items, and cooking aids * Strong presence in key North Indian markets including Uttar Pradesh, Delhi, Haryana, Bihar, Punjab, Uttarakhand, and Rajasthan
KPMG India Corporate Finance is serving as exclusive financial advisor to AWL with PricewaterhouseCoopers Services LLP and Cyril Amarchand Mangaldas conducting due diligence and Cyril Amarchand Mangaldas providing legal counsel.
AWL has demonstrated capability in scaling acquired brands. Amongst its notable successes figure the launch of Alife Soap in 2020 which crossed Rs 100 plus crore in sales within two years. The acquisition of Kohinoor in May 2022 saw it generating Rs 350 plus crore in sales within 18 months. The Hotels, Retail and Catering (HoReCa) team established in Q1 FY23 generated Rs 600 plus crore in sales within two years.
With that kind of a track record, the acquisition can only be a good and taste-filled recipe for success.
Mumbai: In today’s health-conscious world, the choice of cooking oils plays a crucial role in our daily culinary decisions. As people become increasingly aware of the impact of their dietary choices on overall well-being, the selection of the right cooking oil is no longer just a matter of taste; it’s a matter of health. The quest for cooking oils that not only enhance the flavors of our dishes but also promote a healthier lifestyle is driving a significant shift in consumer preferences. This shift towards health-consciousness has led to the rise of cooking oils that offer not only delicious flavors but also essential nutrients and health benefits.
‘Freedom’ is the flagship brand of Gemini Edibles and Fats India Ltd. (GEF India). Freedom Healthy Cooking Oils is available as Freedom Refined Sunflower Oil, Freedom Physically Refined Rice Bran Oil and Freedom Mustard Oil, & Freedom Groundnut Oil.
Freedom Healthy Cooking oils promotes ‘guilt-free eating’ and its brand promise is captured by its tagline ‘Freedom to eat, Freedom to enjoy. It is a range of premium quality healthy edible oils available at a competitive price point.
Indiantelevision.com spoke to Gemini Edibles and Fats India Ltd Sr. vice president of sales and marketing P. Chandra Shekhara Reddy on the brand’s journey, its unique value propositions, and much more…
Reddy is 51 years old and has more than 30 years of cross-functional exposure in various edible oil organisations. He is a go-getter and brings a determined focus on revenue, relationship & repute through his leadership, adaptability & communication skills. He is both people & process driven with a sound understanding of business dynamics. His focus on aggressive brand building and sales team development has helped to create a vibrant workforce. He has been instrumental in setting up a robust and vast distribution network which has been crucial in positioning “Freedom” as the number two brand in the Sunflower Oil category in Andhra Pradesh and Odisha in a short span of two years. His clear understanding of the sector and command over marketing has helped GEF win credibility and trust with stakeholders and partners.
Edited Excerpts:
On Freedom Healthy Cooking Oils’ journey from its inception to becoming the leading brand in the sunflower oil category in India and the the key milestones along the way
The journey for Freedom Healthy Cooking Oils has been amazing. Freedom Refined Sunflower Oil the flagship brand of Gemini Edibles & Fats India Ltd, which was launched in 2010 is now the No. 1 selling brand of Sunflower Oil in India (Source Neilson IQ MAT March 2022), with operations in Andhra Pradesh, Telangana, Odisha, Karnataka, Chhattisgarh, through selected channels in Maharashtra, Tamil Nadu, Jharkhand, West Bengal and Madhya Pradesh.
This was achieved by working on a well-formulated strategy of building a good brand, delivering consistent product quality with attractive packaging, and building a robust distribution network that could help us reach the nook and corner of the states. It was a conscious decision to launch the brand ‘Freedom’ in selected geographies to ensure a better, focused, and optimal use of resources at hand.
To create awareness about Freedom Healthy Cooking Oils, we formulated a well-rounded marketing strategy around the core message of ‘Guilt Free Eating’ giving the customers ‘Freedom to Eat, Freedom to Enjoy.’ For directly reaching out to the target audience – we have initiated several on ground activities like ‘Best Chef Hyderabad’, ‘Freedom Cookery Show’, ‘Healthy Pakoda Party’ and sponsoring various other initiatives to encourage usage and gather acceptance for the brand. We have also partnered with leading properties on OTT and TV Channels like ‘Big Boss – Kannada’ etc. This helped garner a better share-of-voice and visibility for Freedom Healthy Cooking Oils. This helped us break the clutter of brands with 20+ years of legacy in the category.
We also introduced several customer and retailers outreach campaigns like Freedom Aarogya Rath Yatra, Freedom Cookery Shows in urban and rural markets to explain the customers about the benefits of using sunflower oil, and the other variants in our portfolio. With the basics in place, we launched several sales promotion offers like ‘Car Jar Offer’, My Freedom – My Gold Offer to encourage adoption of Freedom Healthy Cooking Oils.
We are also running a campaign ‘Freedom Retail Raja’ to expand the market penetration of Freedom Healthy Cooking Oils and enrol the channel partners on ‘Kirado’ app an innovative platform that helps us design special campaigns, communicate about upcoming new launches and schemes etc. This also provides a 2-way communication channel with retailers. Channel partners can also raise the concern with the organisation, which are assigned and attended as per the prescribed matrix. It is encouraging more retailers to sign up. This is enabling better trust, confidence and transparency with the channel partners and helping grow our market reach.
Our promotion and digital strategy ensured we were connected to the end users and engaged with them for their inputs to help us retain the existing customers and grow the customer base. With the success of sunflower oil, Freedom Healthy Cooking Oils was able to garner share in the other variants launched for niche users based on regional preferences.
Key Milestones:
On the unique value propositions or product attributes that Freedom offers to set it apart from other brands in the market
Gemini Edibles & Fats India Ltd was started by professionals with deep understanding and strong relationships in the market. We launched ‘Freedom’ with a clear objective to make the best product offering, manufactured in the state-of-the-art manufacturing unit, ensuring consistency in quality, innovative packaging, and geographically focused launch to optimize the resources and transportation cost. The policy was always to deliver a good quality product using state-of-the-art infrastructure at a value-for-money price point.
The cooking oil market in India is highly competitive. Instead of spreading our limited resources over a vast geographical area, we also remained focused on the key markets of Andhra Pradesh, Telangana, Karnataka, Odisha, and other neighbouring states, that consume almost 70 per cent of sunflower oil sold in India. We also leveraged our understanding of market dynamics, market penetration, and optimising the resources at our disposal in these states and benefit from consumers’ trust and preference for our brand.
On consumer preference for cooking oils evolving over the years and Freedom adapting to these changing preferences and health-conscious trends
We have started an initiative ‘Freedom Oil Knowledge Series’ that disseminates information about the health benefits of edible oils. As a part of this series, we also conduct seminars using relevant influencers to bring the spotlight on specific myths about edible oils and get experts to discuss and dispel the myths. Most of the communication with our customers is also centered around the benefits of maintaining a healthy lifestyle and using the right cooking oil for daily usage.
To educate customers, as a part of the ‘Freedom Oil Knowledge Series’ a campaign was introduced with famous nutritionist Dr. Matheen Asrar (PhD Nutritionist) advising people to follow a balanced diet, engage in regular exercise, and switch to a healthy cooking oil like Freedom Rice Bran Oil for everyday cooking. This campaign was very well received and has generated over one million views.
Moreover, besides communicating the health benefits of our product range to the customers, we also participate in several initiatives to promote healthy living and healthy eating. We have been associated with a flagship event ‘Freedom Hyderabad 10K Run’ for the last six years, which is a platform to engage with the health conscious, spread the right information about the use of edible oils, and gain their patronage.
On the quality control measures and certifications that Freedom Healthy Cooking Oils adheres to in order to ensure the highest quality products for consumers
Freedom Healthy Cooking Oils prioritises quality assurance by adhering to GMP system (Good Manufacturing Practice) and FSSAI (Food Safety and Standards Authority of India) guidelines. Our fully automated plants streamline the refining and bottling process, reducing human intervention. This ensures consistent quality batch after batch.
This comprehensive strategy, guided by cutting-edge automation, ensures that every SKU of Freedom Healthy Cooking Oils meets the highest benchmarks, offering consumers a reliable and wholesome choice for their culinary needs.
On Freedom Healthy Cooking Oils addressing concerns such as sustainability and environmental issues in its production and packaging processes
Sustainability and concern for the environment is at the core of our philosophy at GEF India. At the factory level, Freedom Healthy Cooking Oils stands out as the sole producer with zero liquid discharges in our plants. Unlike conventional setups where effluent treatment plants are below ground, our unique approach places them above ground, enabling early detection of seepage. Our plants are directly linked to the Pollution Control Board, ensuring emissions are closely monitored.
Moreover, our commitment extends to recyclable packaging. These dual efforts underscore our unwavering dedication to environmental responsibility, ensuring transparency, accountability, and sustainability in every aspect of our operations.
On the key factors contributing to the brand’s popularity, especially considering its diverse offerings, in the context of Freedom’s product range
We believe that ‘Freedom’ is recognised as a trusted and reliable brand by the customers.
We back each offering/ product with consistent and persistent communication, highlighting the USPs of each offering. We devise innovative and creative messaging using all available mediums for communicating with our customers to ensure the acceptance and growth of Freedom Healthy Cooking Oils.
On Freedom leveraging digital platforms and e-commerce to reach a wider audience and enhance the brand’s online presence
India is rapidly going digital. In today’s world, where India is rapidly embracing mobile technology and using it more and more to stay connected, digital marketing is crucial to stay connected and engage continuously with the audience. We have a vibrant digital and social media presence in order to reach and interact with the target audience. We are using social media marketing, tactical influencer marketing, and digital advertising as new marketing channels. Besides advertising and digital public relations campaigns, we are actively exploring and leveraging the traffic flow on Google Apps, YouTube, Facebook, Instagram, and other platforms with OTT (Over the Top) Platforms such as Zee5 and Hotstar.
On the long-term goals and aspirations for Freedom Healthy Cooking Oils in terms of market expansion, innovation, or social responsibility
We are presently fully operational in Andhra Pradesh, Telangana, Odisha, Karnataka, and Chhattisgarh. We are actively working on plans to launch our operations in full state of Tamil Nadu, Maharashtra and Kerala besides moving up East.
We will continue to innovate in our processes and product packaging based on customer feedback. We have recently introduced a 10-litre multi-use jar of Freedom Refined Sunflower oil. It has been specially designed keeping in mind the requirements of the modern-day consumer and a growing trend of using environment-friendly products that can be reused.
We’re planning to introduce “Deepa Prajwalam Oil,” a unique addition to our range. This oil is specially designed for traditional lamp usage, adding a new dimension to our offerings.
Mumbai: BL Agro Industries Limited, one of the fastest growing edible oils and food products companies in India, with a turnover of Rs 2500 crore is on an aggressive expansion mode with extensive brand endorsements to reach out to target audiences.
The company which recently launched TVCs for its brands, Bail Kolhu and Nourish has rolled out its marketing plans for the fiscal year 2021-22. The company will invest in a media mix of mainline, digital and innovative media vehicles led by Television, to create brand positioning resulting in consumer awareness and demand for BL Agro products across India.
“Our company is on an aggressive B2C expansion spree with a keen eye on profitable incremental growth and sustained capability, which can be achieved through proper marketing strategies” says BL Agro managing director Ashish Khandelwal.
“To take the brand to the next level through marketing and proper messaging, we have earmarked a media budget of Rs 150 crores for the current year. With a vision to contribute to the nation’s agro-economy, we would be channelizing our capacities through a manifold approach to reach out to the maximum audiences,” Khandelwal added.
BL Agro’s brands include Bail Kolhu, a 50-year-old product, and Nourish that envision a growing need to add nutrition to the consumers’ daily food habits. The company recently on-boarded Nawazuddin Siddiqui, Manoj Bajpayee, Pankaj Tripathi and Shilpa Shetty for its brands, says BL Agro brand spokesperson Richa Khandelwal.
“The entire range of BL Agro products are (meant) for all age groups, across different strata of society, and therefore it is imperative to be on every media. Television still holds the maximum mileage, where spends would be close to 60 per cent, followed by the print/radio/OOH, digital and online media besides other media such as public relations and influencer marketing,” adds Richa.
BL Agro consistently produces nutritionally well balanced quality food products using state-of-the-art technology that provides substantial support to Indian farmers. The company has a wide portfolio of food products and relies on agricultural value chains to procure raw materials at scale thus boosting farmer incomes. The company also aims to empower farmers and drive long-term growth through creation of infrastructure to support the agro-industry.
At the same time, with expansion of such a magnitude, BL Agro is contributing considerably in the domain of employment generation. The company already has a work force strength of about 5000, including a huge field force, with this number set to rise in times to come.
Key synergies from the acquisition include:
