Ruchi Soya, the India-based edible oil supplier, is seeing “visible signs of recovery”, its chief executive has said, alongside the publication of declining annual sales and rising losses.
In the year to 31 March, Ruchi Soya generated total sales from operations of INR185.27bn (US$2.88bn), down sharply from INR27.69bn 12 months earlier.
Ruchi Soya made an after-tax loss of INR12.57bn, against INR10.62bn a year ago. The company pointed to the “lower utilisation of manufacturing capacities” and “much lower trading sales due to [a] rebalancing of trading portfolio and [a] shift in focus on core business activities”.
The business provided a figure for its annual EBITDA “before accounting for [the] provision for doubtful debts” of INR6.16bn, compared to INR3.67bn in its previous financial year.
Ruchi Soya said the sales it made from branded products fell from INR90.94bn to INR86.46bn but said the proportion of its sales made up by brands rose from 33% to 46%.
“Ruchi Soya has come through testing times with visible signs of recovery now appearing, powered largely by our branded sales business. This is apparent in our results which reflect the strong foundation of our core business. We are confident that the measures being taken in the areas of cost control and capacity optimisation will bear fruit in the coming quarters,” founder and managing director Dinesh Shahra said.
“We continue to engage with banks and financial institutions for resolution of all issues. We are hopeful for a solution in the near future that will remove roadblocks to our fast track growth and allow us to create value for our shareholders by driving sustainable, profitable sales growth. Edible oil
consumption, especially packaged and branded oil, is growing giving our business strong growth potential.”
Shahra added: “Our competitive position in the edible oil business remains firm as we prepare for the launch of GST. GST will be beneficial to organized players and allow us to access a pan-Indian market with process efficiencies that will reflect in reduced operational costs. GST will also add muscle to our branded sales which should show enhanced performance in the coming quarters.”
On 1 July, a set of new, nationwide taxes on goods and services will come into force in India, replacing a system of national, state and municipal charges.