Amul's marketing firm GCMMF eyes 20% sales growth in FY18, to invest Rs 2,500 crore
The Gujarat Co-operative Milk Marketing Federation (GCMMF), which markets the Amul brand of milk and dairy products, is expecting 20% sales growth in 2017-18, a company official said in Kolkata on Saturday.
According to the official, the firm also had plans to invest Rs 2,500 crore over the next three years to build new milk processing plants across states to enhance its processing capacities.
The dairy firm intends to be India`s biggest FMCG company, surpassing Hindustan Unilever Ltd (HUL) by the end of 2018-19, according to him.
"We plan to grow 20% in the current fiscal and we wish to be the biggest FMCG company in India by 2018-19 crossing HUL," the firm`s Managing Director R S Sodhi told reporters.
"If we have to grow by 20%, we have to expand milk procurement from outside Gujarat. We procure about 200 lakh litres of milk per day. Of this, around 15% of milk is being procured from outside Gujarat. There is a need to procure 13-14% more milk to meet the growth target," he said.
Apart from Gujarat, the firm collects milk from Rajasthan, Haryana, Uttar Pradesh, Punjab, West Bengal and Maharashtra. It will start procuring from Bihar and Jharkhand as well.
"We are working out to enter Tamil Nadu and Kerala," he said.
"We invest about Rs 800 crore every year for setting up new processing plants. We have planned to invest Rs 2,500 crore to build up processing plants across states," Sodhi said.
The firm registered a provisional turnover of Rs 27,085 crore for the financial year 2016-17, up by 18% from sales turnover of Rs 22,972 crore in the previous year.
He said the firm achieved a compound annual growth rate of 19% in the last seven years because of higher milk procurement, continuous expansion in terms of adding new markets, launching of new products and adding new milk processing capacities across India.
GCMMF has planned to achieve a turnover of Rs 50,000 crore by 2020-21, Sodhi said. It also plans to enhance its milk processing capacity from the current level of 300 lakh litres per day to 380 lakh litres per day in the next three years.
Speaking about the firm`s West Bengal plan, he said the dairy major was setting up a plant in Howrah district with an investment of Rs 250 crore. "The plant will handle about 10 lakh litres of milk per day and is expected to be commissioned in the next one year," Sodhi added.