On Friday, shares of Adani Wilmar ended 1.09% lower at ₹336.30, marking a downturn despite a positive quarterly business update. The company, which is a joint venture between India’s Adani Group and Singapore's Wilmar Group, announced a 10% rise in total sales volume for the September quarter.
Despite this performance, the stock’s closing price reflects an ongoing bearish trend, which may prompt investors to consider whether to invest in stocks to reassess their options.
Quarterly performance and market position
Adani Wilmar's total market capitalisation stood at ₹43,708 crore as of Friday. Over the past year, the stock has fallen by 4.62%, while the last six months saw a more significant drop of 8.37%. The stock’s price trend indicates that it is currently trading lower than key averages, including the 5-day, 10-day, 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day moving averages.
In terms of trading activity, 0.65 lakh shares changed hands on the Bombay Stock Exchange (BSE), generating a turnover of ₹2.21 crore. With a one-year beta of 0.9, Adani Wilmar’s stock has shown moderate volatility, reflecting a typical risk level in comparison to the broader market.
Business growth driven by edible oils and food products
In its latest business update, Adani Wilmar reported a robust revenue increase of 16% year-on-year (YoY), driven by its strong performance in the edible oils and food segments. The company highlighted its ability to scale distribution across various regions in India, benefiting from its diverse product portfolio and increased operational efficiency.
The edible oils business remained the key driver of growth, with notable double-digit YoY volume increases in key categories such as soybean, sunflower, and mustard oils. This strong performance aligns with the firm’s ongoing efforts to expand its footprint in the fast-moving consumer goods (FMCG) sector.
Rising revenue from alternate channels
Adani Wilmar has also seen impressive growth in its alternate sales channels. Over the past twelve months, revenue from these channels surpassed ₹3,000 crore, with the e-commerce segment exhibiting particularly rapid expansion. According to the company, e-commerce revenue has grown nearly fourfold over the past four years, underscoring the potential of digital sales in the modern market.
Moreover, the Food & FMCG division recorded a remarkable 36% revenue growth YoY, largely due to increased outlet penetration and repeat purchases of food products. Excluding the government-to-government (G2G) business, revenue growth for this segment stood at 26% YoY. This expansion highlights the company’s ability to cater to the growing demand for its food products across the country.
Long-term outlook for Adani Wilmar
Despite these strong business fundamentals, the recent performance of Adani Wilmar’s shares suggests a degree of caution in the stock market. Investors who are looking to invest in stocks may find this a moment to watch closely as the company navigates current challenges, particularly with its share price trading below multiple key moving averages.
The company’s consistent performance in the edible oil and FMCG sectors, alongside its aggressive push into digital and alternate sales channels, positions Adani Wilmar for potential long-term growth. However, the stock’s recent decline raises important questions about market sentiment and external factors influencing its share price.
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