Adani Wilmar CEO: GST Cuts to Boost Processed Foods Sector, Edible Oil Unaffected
Adani Wilmar's CEO Angshu Mallick welcomes GST rate reductions on processed foods. Margarine tax cut from 18% to 5%, benefiting bakeries and ice cream makers. Soya nuggets GST reduced from 12% to 5%, potentially increasing protein affordability and supporting farmers. Jams and jellies also see tax reduction to 5%. Rural India expected to benefit significantly. Edible oil GST remains at 5%. Adani Wilmar anticipates growth in soya-based products and margarine sales following these changes.
*this image is generated using AI for illustrative purposes only.
Adani Wilmar's CEO, Angshu Mallick, has expressed optimism about the recent GST rate reductions, stating that they will significantly boost India's processed food sector. While the GST rate for edible oil remains unchanged at 5%, several other processed food categories have received substantial tax cuts, potentially reshaping the market dynamics.
Key GST Rate Changes
| Product | Old GST Rate | New GST Rate |
|---|---|---|
| Margarine | 18% | 5% |
| Soya nuggets | 12% | 5% |
| Jams and jellies | 12% | 5% |
Impact on Various Sectors
Margarine Industry
The reduction in GST for margarine from 18% to 5% is expected to make it more competitive with ghee and edible oil. This change is particularly beneficial for bakeries and ice cream manufacturers, potentially leading to increased usage of margarine in these industries.
Soya Products
The GST cut on soya nuggets from 12% to 5% is anticipated to have multiple positive effects:
- Improved affordability of protein for consumers
- Increased support for soybean farmers due to growing demand
- Expansion of the soya nuggets market, currently valued at Rs 1 lakh tonne and growing at 15-18% annually
Rural India
Mallick emphasized that rural India is expected to benefit significantly from these tax cuts, particularly from the reduced GST on soya nuggets.
Adani Wilmar's Product Line
The company, which produces soya nuggets, jams, and jellies, stands to benefit from the GST reductions on these products. However, Mallick noted that branded atta, suji, and dal did not receive the anticipated exemptions.
Outlook for Edible Oil
Despite the changes in other categories, the GST rate for edible oil remains unchanged at 5%. As a result, Adani Wilmar expects edible oil volumes to remain stable.
Future Prospects
While edible oil sales are expected to maintain their current trajectory, Adani Wilmar anticipates strong momentum in soya-based products and margarine following these tax adjustments. The company is well-positioned to capitalize on the growing demand for processed foods, particularly in the soya and margarine segments.
These GST reductions represent a significant shift in the processed food industry, potentially leading to increased consumption and market growth. As one of the major players in the sector, Adani Wilmar is poised to adapt to and benefit from these changes in the coming months.
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