August 5, 2021

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Amul reports highest ever sales; attributes growth to surge of in-home consumption

India’s largest dairy brand Amul has reported its highest ever sales, at Rs 39,248 crore, for the year 2020-21, riding on surge of in-home consumption and optimised last mile deliveries amid the pandemic. Amul’s packaged consumer business, which includes milk, cheese, butter and ice-cream, and competes with Hindustan Unilever and Britannia, grew by 8.1% year-on-year.

“With out-of-home consumption significantly impacted during the pandemic, we focused on in-home consumption, re-modelled last mile supply chains, leveraged online and home deliveries in multiple ways and launched many new products on the immunity platform,” said RS Sodhi, managing director of Gujarat Cooperative Milk Marketing Federation (GCMMF) that owns the Amul brand.

The Amul Group overall, which includes sales of milk though cooperatives across the country, reported a turnover of over Rs 53,000 crore. The cooperative aims to double its group turnover to Rs 1 lakh crores by the year 2025, the company said.

While sales of Amul’s dairy products at restaurants and hotels declined on account of shutdowns throughout the year, the company flagged managing last mile deliveries as its biggest challenge in the pandemic hit year.

Speaking on the consumption outlook for the rest of the year, Sodhi said Amul forecast growth of 15-16% for the next three quarters, riding on improved consumer sentiment, easing of operating curbs, re-openings of hotels and restaurants and economic revival. In addition, Amul also hiked prices starting July 1 after a gap of more than one-and-a-half year, following increased costs of packaging, logistics and commodities.

E-commerce contributed 7% to Amul’s overall sales, and the momentum is expected to continue, he said. Almost all large consumer goods companies have reported doubling of sales through online grocery platforms through the pandemic, as state-wise lockdowns and fears of the virus kept consumers away from supermarkets and modern trade outlets, leading them to switch to shopping for groceries on e-commerce.

Amul said it did not cut back on ad spends, and redesigned campaigns to educate and inform consumers about new launches in the ready-to-cook spaces, as consumers stayed indoors, with offices and schools shut through most of the year.

“Growth in sales of consumer products in the household segment helped us mitigate the impact on demand from hotels and restaurants,” Sodhi said.

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