Amul’s new plants in Delhi, Kolkata, Pune; infusion of about Rs 800 crore on the cards

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Updated: May 27, 2019 3:19:56 PM

Talking about the expansion, Amul MD RS Sodhi said that the co-operation makes similar investments every year.

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Amul will set up new plants in Delhi, Kolkata and Pune as it looks to invest about Rs 800 crore in this financial year to expand capacity, Managing Director RS Sodhi told Financial Express Online. The company will set up new milk processing plants and expanding the capacity of existing units, Sodhi said in an interview to PTI published earlier today. Amul is also targeting Rs 40,000 crore annual turnover with an expected 20% increase from previous over Rs 33,000 in FY19, Amul boss said. Talking about the expansion, he said that the co-operation makes similar investments every year adding that the “the company is looking at setting up new plants in locations that are closer to the Delhi-NCR market”.

Amul, which is one of the few companies to post healthy quarter results amid the consumer slowdown woes, said that its revenue growth resulted because of the stable prices of its products and higher volume growth. However, this year, the company expects a growth in both the volume and value numbers.

Meanwhile, the co-operation recently increased the price of its milk by Rs 2 per litre. Amul said that it had the interest of farmers in the mind while making the move as the cattle feeding costs are on high. Major milk brands have been battling high competition and kept their prices in check for the last two years before the recent price hike. Amul’s rival brand Mother Dairy soon followed the suit and hiked the rates as well. Both the companies also said that the majority of the profits earned by the company flow back to the farmers.

While major FMCG brands are reeling under the rural slowdown distress, Amul had previously said that India is a country of the lower middle class and if the products are priced accordingly, the consumption is growing. Amul also said that it is quite secure of its consumer base as food is one entity that the households will continue to buy irrespective of their prosperity level.

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