RETAIL PENETRATION STUDY OF EDIBLE OIL

MARKET IN HYDERABAD

Prepared for

Adani Wilmar

Prepared by

Sidharth Choudhari
PGDM - MM1012121

Balaji Institute of Modern Management

Pune 411 033
July 2011

ACKNOWLEDGEMENT

I am highly indebted to Mr. VIPUL RAJYAGURU for his guidance

and constant supervision as well as for providing necessary
information regarding the project & also for his support in completing
the project.

CERTIFICATE

This is to certify that this internship report on Retail Penetration study of

edible oil market in Hyderabad at Adani Wilmar is a bona-Fide work of
Mr. SIDHARTH CHOUDHARI under my guidance and support. This report
is a part of Post Graduate Diploma in Management (PGDM) course with
specialization in MARKETING stream and content and the work done is
genuine with respect to the information covered and thought expressed. The
internship period was of two months ( 1st june 2011 31st july 2011 ).

Mr.VIPULRAJYAGURU
SeniorManager
ADANIWILMAR LTD.

DATE:
PALCE:

CONTENTS

TOPIC

PAGE NO

1.Executive Summary

2. Introduction about the Industry

3. About the Company

4. Research Objectives & Methodology

11

5. Data Analysis and Interpretation

12

6. Conclusion

25

7. Recommendation

26

8. Limitation

27

Annexures
i) Questionnaire

CHAPTER 1
EXECUTIVE SUMMARY

The research conducted was objective in nature. Hyderabad city was surveyed to attain
certain objectives. The survey was conducted to analyze the retail penetration of the
various brands available in the market, classifying the various types of stores i.e general
stores, oil stores, food stores, grocers and other stores also analyzing the size of the
various shops and the number of brands that they keep in the various categories like soya
bean oil, sunflower oil, olive oil, mustard oil, palm oil and also finding the penetration of
the various brands of basmati rice .
With these objectives in mind survey was conducted in Hyderabad city. Questionnaire
method was used along with interviews to obtain the required information. Care was
taken so that the responses could be collected from maximum number of shops from a
particular area and also the adjacent areas. The areas on which the brand track survey
was done from the housewives were selected along with some other areas close by.
The sample size of 200 respondents was taken for this purpose from various parts of
Hyderabad. All the four zones of the city were considered to have an overview of the
brand presence in various stores.
After the survey was complete , the data was first sorted then analysed on chosen
parameters. This analysed data was later converted into form of graphs such as bar
graphs . This was to make results easily comprehensible by anyone going through the
report. This also made it easy to draw conclusions based on the research and provide a
presentable format of the report.
Later on , all this information was compiled in the form of a presentable and highly
comprehensible report.
The important findings are:

Most of the outlets visited were multibranded.

Among the total shops that were covered maximum shop owners were stocking
Goldrop , followed by stocking of Ruchi Gold , Krishna & Vijaya , Fortune.
According to most of the shop owners consumers prefer Goldrop in the sunflower oil
segment, the presence of Goldrop is most of the shops indicate the good distribution
network of the brand.
In the palm oil category Ruchi Gold is the leader outplaying most of the other players
with its presence. Goldrop manages to be a distant second player when it comes to the
retail penetration. Shop owners expressed that Ruchi Gold is the leader when it comes
to palm oil category when it comes to Hyderabad city.

In the category of Olive oil Figaro is the front runner with its presence in most of the
stores followed by leonardo.This category do not include the Indian players. Its an
expensive oil . All the companies are generally Italian in this segment.
Most of the purchase made by the respondents was made from the local market (
Begum bazaar is a huge market when it comes to edible oil category in Hyderabad).
Distributer supply was found in a few cases.
Most of the dealers knew about the brands but said that since only a few brands sell
they have stopped stocking the other brands.
The schemes provided by the local brands like Goldrop are much lucrative to the
shop owners and they get good credit from the market as well as some distributers.
In the Basmati rice category India gate rice dominated followed by Kohinoor, Dawat
and some other brands.

CHAPTER 2
INTRODUCTION ABOUT THE INDUSTRY

The edible oil industry is one of the leading sustainers of the positive annual economic
growth rates. The raw materials required for edible oil processing are sunflower, cottonseed,
soybean, oil palm. The other available oilseeds are sesame, peanuts and oil fractions of crop
plants. The major product of edible oil is processing vegetable cooking oil, which is used for
frying. Generally, the crude oil is purchased on large scale, refined and then sold either as
bulk or packed items.

The domestic demand for edible oils has grown at a

CAGR of about 5% from FY 2000 to FY 2010 mainly driven by improving per capita
consumption. Indias annual per capita consumption of about 12.7 kg is well below the world
average of 20 kg; thus signifying substantial growth potential for the edible oils industry. The
growth of branded edible oils is expected to remain favourable on the back of the
development of the retail sector and rising income levels. The consumption pattern of edible
oils is a function of regional tastes, preferences and relative price levels. Palm oil is the
cheapest variety of oil and accounts for around 35-40% of overall consumption. The
dependence on imports remains high due to less than adequate growth in production. Imports
contribute to 45% of total consumption with certain segments like palm oil relying entirely on
imports.

The demand growth for edible oils is expected to be favourable driven by

growing population, increased per capita consumption and increasing affluence levels. Indias
annual per capita consumption has shown an increasing trend; growing from 4 kg in the
1970s and 10.2 kg in the late 1990s to a current level of 12.78 kg.

However, this is well below the world average of around 20 kg thus signifying substantial
growth
potential
for
the
edible
oil
industry.
The
demand
for
the
overall edible oil market is expected to grow between 3-4% p.a. The growth rate for the
branded edible oil segment (currently 15% of total market) is expected to be higher than the
average driven by increasing income levels, spread of modern retailing and preference of
consumers for quality products.

List of Leading Edible Oil Manufacturers in India

TOTAL TURNOVER
2009-10
(RS. CR.)
Ruchi Soya
13,435
Adani Wilmar
6,109
Cargill India
6.042
KS Oils
4,030
Gokul Refoils
2,819
Marico
2,031
Sanwaria Agro
1,117
Source: ICRA Online Analysis
The oil industry is witnessing a 6% compounded annual growth rate (CAGR), while the
branded sector is growing at about 15-20%. Marico Industries' Saffola is seeing a CAGR of
13%, while its Sweekar has a CAGR of 8%. Mother Dairy's Dhara has a growth rate of 6%.
Adani Wilmar's Fortune has a CAGR of 24%.

CHAPTER 3
ABOUT ADANI WILMAR

The Adani Group is a Gujarat based Indian conglomerate with the industrialist Gautam
Shantilal Adani as its CMD and promoter. Founded in 1988, the Adani Group .One of
India's fastest-growing business houses The core business of the group is Commodities
Trading, edible oil Manufacturing, Mundra port operations and distribution of Natural
Gas.Adani Group the leader in International trading, Power Sector and Private
infrastructure.

Adani Group is a business behemoth based in India having a global footprint with
interests in Infrastructure, Power, Global Trading, Logistics, Energy, Port & SEZ,
Mining, Oil & Gas, Agri Business, FMCG products, Real Estate Development,
Bunkering.
The entire business of the group is organized under two companies: Adani Enterprises
Ltd. and Mundra Port and Special Economic Zone Ltd. Both companies are listed on The
National Stock Exchange of India (NSE) and The Bombay Stock Exchange (BSE).
The Wilmar Group
Wilmar International Limited, founded in 1991 as a palm oil trading company, is today
Asia's leading agribusiness group. It ranks amongst the largest listed companies by market
capitalisation on the Singapore Exchange .

Its business activities include oil palm cultivation, edible oils refining, oilseeds crushing,
consumer pack edible oils processing & merchandising, specialty fats, oleo chemicals and
biodiesel manufacturing, and grains processing and merchandising

The leading importer of edible oils into East Africa and one of the largest importers of
edible oils into South- east Africa.

The largest global processor and merchandiser of palm and lauric oils.

The largest edible oils refiner in Ukraine.

9

Headquartered in Singapore, its operations are located in more than 20 countries across
four continents, with a primary focus on Indonesia, Malaysia, China, India and Europe.

Overview of Adani Wilamar

Adani Wilmar Limited (AWL), a Rs. 6500 crore company is a joint venture between
two global corporations. Adani Wilmar Limited is a 50:50 joint venture between two
recognized Multinational Corporations the INR 275 Billion (US $5 Billion), and
Wilmar International Limited, Singapore, Asias leading Agri business group with
revenues exceeding US $16.5 billion.
Together, the Adani Group and Wilmar Group have set up India's first port based
refinery at Mundra, Gujarat. Today the Mundra refinery is one of India's largest and
most sophisticated oil refineries. FORTUNE, King's, RAAG, Bullet, Fryola and
JUBILEE are the brands under which AWL(Adani Wilmar) sells its range of edible
oil, vanaspati and bakery shortening.

The company has production infrastructure across the country with a crushing
capacity of over 6000 TPD (Tonnes per Day) and Refining capacity of over 5000
TPD.

AWL is one of the very few national players in the Industry to have this massive
production infrastructure, with all its plants so strategically located to take advantage
of the Import Parity and Domestic crop season.

With 80 branches, 5000 distributors catering to 1 million outlets, AWL's products

reach to 20 million households across India.

The company also has packing operations at Kadi [Gujarat], Latur [Maharashtra],
Jaipur [Rajasthan], Dharwad [Karnataka], Dewas [Madhya Prades], Nagpur
[Maharashtra] and Cochin [Kerala].

VISION STATEMENT OF ADANI WILMAR

GOLBALLY COMPETITIVE INDIA FOCUSED MNC, WITH LEADERSHIP IN
EDIBLE OIL BUSINESS PROVIDING BRANDED PRODUCTS AND SERVICES TO
THE DELIGHT OF CUSTOMER AND STAKEHOLDERS

10

CHAPTER 4
RESEARCH OBJECTIVES & METHODOLOGY
Research Objectives

To find out relative strength of leading cooking oil brands in town.

Market Strength to be measured by Retail presence through retailer feedback

RESEARCH TYPE

Quantitative Descriptive Research Study

Research Methodology

Market strength to be checked by visiting all cooking oil keeping retail outlets in a
given area (complete retail census). Retailer response to be taken on structured
questionnaire.

Sample Size - 200 Retailers

11

CHAPTER 5
DATA ANALYSIS AND INTERPRETATION
The data collected from the primary sources (through collection of the responses to the
questionnaire was assembled, sorted, selected and analyzed) .The analysis of the data is as under.

Calculation of retail penetration of different brands:-

FORMULA USED
RETAIL PENETRATION

= total number of stores where brand is found of a category

Total number of stores visited stores where category is not found

Q. 1) Retail penetration for Fortune in different categories.

80
70
60

FORTUNE RETAIL PENETRATION

67.44%

50
40
30

27.27%

20
5.12%

10

10.76%

5.38%

FORTUNE

0
FORTUNE
SOYABEAN

FORTUNE
SUNFLOWER

FORTUNE
FORTUNE
PLUS
GROUNDNUT
SUNFLOWER

FORTUNE
KGMO

The percentages shown in the graph above show the retail penetration of
the various categories in which the brand is existing. Fortune KGMO has
the maximum retail penetration , in soyabean category the brand needs
push , same applies with other categories as well.

12

Penetration of the brand Fortune:Out of the total stores visited in the survey ( sample of 200) only 38.5 % stores kept
Fortune.

Q.2) Retail penetration for Goldrop in different categories.

120
100

97.79%
86.36%

GOLDROP-RETAIL
PENETRATION

80
60
GOLDROP

40
10.49%

20
0
GOLDROP
SOYABEAN

GOLDROP
SUNFLOWER

GOLDROP
PALM OIL

Golddrop is the leading brand of edible oils when it comes to Hyderabad city. By looking
at the retail penetration of Golddrop it can be very well concluded. In the category of
Soyabean oil out of the sample of 200 Golddrop is found in 86.36% of the stores , in the
category of Sunflower oil Golddrop has 97.79% of retail penetration but in palm oil
category it has only 10.49% of retail penetration.
Tha brand is only found in these categories but has its strong presence in the categories in
which it is found.

Penetration of the brand Golddrop : Out of the total sample of 200 stores , 95.5% of the stores kept Golddrop brand. The
number show clear domination of the brand in the city.

13

Q.3) Retail penetration of Aadhar and Naturalle ( Sunflower).

60

50
40

RETAIL
PENETRATION FOR
ADHAAR &
NATURALLE

48.2%

30
20

SUNFLOWER OIL

13.84%

10
0
ADHAAR SUNFLOWER

NATURALLE
SUNFLOWER

Both brands Aadhar and Naturalle have the retail penetration of 13.84%
and 48.2% respectively. Naturalle has a comparatively strong presence than
Aadhar when it comes to the category of sunflower oil.

Q. 4 Retail penetration of Natraj, Vijaya and Krishna ( Groundnut Oil).

51

50.29%

RETAIL PENETRATION
OF GROUNDNUT OIL
FOR VARIOUS BRANDS

50
49
48
47

46.1%

46
45

GROUNDNUT OIL

44.31%

44
43
42
41
VIJAYA
GROUNDNUT

KRISHNA
GROUNDNUT

NATRAJ
GPRUNDNUT

In the category of groundnut oil Vijaya has the maximum retail penetration of 50.29%
followed by Natraj and Krishna with 46.1% and 44.31% respectively.

14

Q.5) Retail penetration of Ruchi gold , Raag and Alfa ( Palm Oil )
120
100

98.14%

PALM OIL - RETAIL

80
60
PALM OIL

40
20

0.62%

4.32%

RAAG GOLD

ALPHA

0
RUCHI GOLD

In the category of Palm oil Ruchi Gold had the maximum penetration in the stores . It
led by 98.14 % of retail penetration. The other two brands Raag Gold and Alfa were
faar behind in terms of retail penetration.

Q. 6) Retail penetration of Other brands and Fortune KGMO.

MUSTARD OIL PENETRATION OF

FPRTUNE KGMO & OTHER BRAND
80
70
60
50

67.44%
45.34%

40
30
20
10

MUSTARD OILPENETRATION

0
FORTUNE KGMO

OTHER BRANDS

Fortune KGMO leads with 67.44% followed by others brands in this

category 45.34%.

15

Q.7) Retail penetration of Olive oil brands.

RETAIL PENETRAION OF PALM OIL

100
90
80
70
60
50
40
30
20
10
0

94.44 %

PALM OIL

5.55%
FIGARO

5.55

5.55%

LEONARDO

OTHER BRAND OTHER BRAND

In the case of retail penetration of olive oil category Figaro 94.44% leads the
way with maximum retail penetration. The other brands are far behind with
Leonardo having 5.55% penetration and followed by other brands.

Q.8) Retail penetration of Basmati Rice Brands.

RETAIL PENETRATION OF BASMATI

RICE
60
50
40
30
20
10
0

52.22%
32.22%
24.44%
5.55%

3.33%

BASMATI RICE

India Gate has the maximum retail penetration with 52.22% followed by Kohinoor
with32.22% and Dawat 24.44% respectively.

16

9.Q) Availability of Sunflower oil in Food store(Large, Medium, Small)

30
25
25
20
16

Fortune plus sunflower

15

Aaadhar sunflower

10

Gold Drop sunflower

4

Naturelle sunflower

1 1

FORTUNE sunflower

0
LARGE

MEDIUM

SMALL

FOOD STORE

Out of total retailers covered, including large, medium and small stores Goldrop
sunflower has the maximum presence in the medium size shops, followed by
Naturalle followed by Adhaar and Fortune. Even in the large and small stores
Goldop Dominates.

10.Q) Availability of Sunflower oil in General store(Large, Medium, Small)

140

120

120

Fortune plus sunflower

Aaadhar sunflower
Gold Drop sunflower
Naturelle sunflower
FORTUNE sunflower

100
80

60

60
33

40
20

2 4 1

1315

3 1

13

0
LARGE

MEDIUM

SMALL

GENERAL STORE

Out of the total retailers covered, including the large, medium and small stores
Goldrop Sunflower had the maximum presence in the medium size shops, followed by
Naturalle followed by Adhaar Sunflower. Even in the large and small stores Goldrop
Dominates.

17

11.Q)Availability of Sunflower oil in Edible Oil Store (Large, Medium, Small)

2.5
2
Fortune plus sunflower

1.5

Aaadhar sunflower

Gold Drop sunflower

0.5

Naturelle sunflower

FORTUNE sunflower
MEDIUM

SMALL

EDIBLE OIL STORE

Out of the total Edible oil stores covered, Goldrop has the maximum presence in
small edible oil store followed by Naturalle followed by Adhaar.

12.Q) Availability of Groundnut oil in Food Store(Large, Medium, Small)

18
16
14
12
10
8
6
4
2
0

16
14
Natraj groundnut

Vijaya groundnut
3
1

3
1

Krishna groundnut
Fortune groundnut

LARGE

MEDIUM

SMALL

FOOD STORE

Out of the total food stores visited Krishna has the maximum presence
followed by Vijaya and Natraj.

18

13.Q) Availability of Groundnut oil in General Store (Large, Medium, Small)

60
52

54

50
41
40
Natraj groundnut

30

Vijaya groundnut
20
12
10

3 4

Krishna groundnut

11
7

Fortune groundnut

0
LARGE

MEDIUM

SMALL

GENERAL STORE

In the category of Groundnut oil Viaya oil showed its presence in most of the
stores followed by Krishna then Natraj.

14 Q) Availability of Groundnut Oil in Edible oil Store (Large, Medium, Small)

2.5
2
2
1.5

Natraj groundnut
1

Vijaya groundnut

Krishna groundnut
0.5

Fortune groundnut

0
MEDIUM

SMALL

EDIBLE OIL STORE

Out of the total Edible oil store visited Vijaya has the maximum presence in Small
and Medium stores followed by Krishna.

19

15.Q) Availability of Palm Oil in Food Store (Large, Medium, Small)

25
21
20
15

Ruchi gold palm oil

Gold Drop palm oil

10

Raag Gold palm oil

4

Alpha palm oil

1 1

0
LARGE

MEDIUM

SMALL

FOOD STORE

In the palm oil category Ruchi Gold was present in most of the stores followed by
Goldrop in Medium stores but the difference between the presence of the two
brands was huge.

16.Q) Availability of Palm Oil in General Store (Large, Medium, Small)

120
98

100

80
Ruchi gold palm oil

60

Gold Drop palm oil

40

28

20

Raag Gold palm oil

Alpha palm oil

12
4 1

0
LARGE

MEDIUM

SMALL

GENERAL STORE

In the palm oil category Ruchi Gold was present in most of the stores followed by
Goldrop in Medium stores but the difference between the presences of the two
brands was huge.

20

17.Q) Availability of Palm Oil in Edible Oil Store (Large, Medium, Small)
2.5
2
2
1.5

Ruchi gold palm oil

1

Gold Drop palm oil

Raag Gold palm oil

0.5

Alpha palm oil

0
MEDIUM

SMALL

EDIBLE OIL STORE

In few Edible oil stores visited in the category of palm oil, Ruchi Gold has the
maximum presence.

18.Q) Availability of Soyabean Oil in General Store (Large, Medium, Small)

12

11

10
8

FORTUNE SOYABEAN
6
4

4
2

FORTUNE PLUS
SOYABEAN
GOLDROP SOYABEAN

0
LARGE

MEDIUM

SMALL

GENERAL STORE

In the category of Soyabean oil, most of the general store visited kept
Goldrop, followed by Fortune showed its little presence in the few Stores.
No other brand was found in this category other than the mentioned brand.

21

19.Q) Availability of Soyabean Oil in Food Store (Large, Medium, Small)

2.5
FORTUNE SOYABEAN

2
2

FORTUNE PLUS SOYABEAN

GOLDROP SOYABEAN

1.5
1

0.5
0
LARGE

MEDIUM

SMALL

FOOD STORE

Goldrop has the maximum presence in most of the food stores in this category of Soyabean oil
visited followed by Fortune.

20.Q) Availability of Olive Oil in General Store (Large, Medium, Small)

11

12
10
8

Figaro olive oil

6
4

Leaonardo olive oil

2

Borges olive oil

Other Brand olive oil

0
LARGE

MEDIUM

SMALL

GENERAL STORE

In the Olive Oil category Figaro was the most found brand among its
competitiors.Leonardo showed presence in few stores.

22

21.Q) Availability of Mustard oil in Food Store (Large, Medium, Small)

12

11

10
8
6

Fortune KGMO

Other Brand

2
2
0
LARGE

MEDIUM

SMALL

FOOD STORE

Fortune led the presence in this category with most of the stores keeping the
brand. The other brands were not so dominating in this category

22.Q) Availability of Mustard oil in General Store (Large, Medium, Small)

40

35

35
29

30
25
20

Fortune KGMO

15

Other Brand

10
5

0
LARGE

MEDIUM

SMALL

GENERAL STORE

Fortune led the presence in this category with most of the stores keeping the brand. The
other brands were not so dominating in this category.

23

23.Q) Availability of Mustard oil in Edible Oil Store Store (Large, Medium, Small)
2.5
2
2
1.5
1
1

Fortune KGMO
Other Brand

0.5
0
MEDIUM

SMALL
EDIBLE OIL STORE

Fortune led the presence in this category with most of the stores keeping the brand. The other
brands were not so dominating in this category.

24

CHAPTER 6
CONCLUSION
The data analysis and its interpretation leads to the following conclusions.

Most of the stores visited in the survey were general stores .

If the sample is observed then it would be seen that maximum stores were of
medium size ( 300- 600 sq. Ft) followed by small stores ( less than 300 sq. Ft )
followed by large stores ( more than 600 sq. ft ).
The retail penetration of Fortune brand was only 38.50% in Hyderabad city.
The retail penetration of Fortune was maximum in mustard oil category with
67.44 % of retail penetration.
In the other categories the brand was lagging far behind and needed a lot of
push when compared to the leader.
Golddrop , the leading edible oil brand in the city had an impressive retail
penetration in the categories in which it competes, 97.7% in the sunflower oil
category followed by 86.36% of retail penetration in soyabean oil category
followed by 10.49 % of retail penetration in palm oil category.
Golddrop had an overall retail penetration of 95.5 %
In sunflower oil category other brands like Naturalle and Aadhar had the retail
penetration of 48.2 % and 13.8 % respectively.
In the groundnut oil category Vijaya had the maximum retail penetration of
50.29 % followed by Natraj with 46.1% penetration followed by Krishna with
44.31% retail penetration.
In the palm oil category Ruchi Gold has the maximum retail penetration of
98.14% , the other brands are lagging far behind.
In the olive oil category Figaro has the maximum retail penetration of 94.44%
followed by Leonardo with 5.5% of retail penetration.
Basmati rice market is dominated by India gate Brand having maximum retail
penetration of 52.22% followed by Kohinoor with 32.2 %. followed by Dawat
with 24.44%.

25

CHAPTER 7
RECOMMENDATIONS

PRODUCT

There should be more research and development to outplay the Health factor
and taste of Goldrop edible oil.

PRICE

Pricing structure plays an important role in brand decisions. Thus the prices
should be competitive.
In Hyderabad the prices of the leader are less than Fortune ( the flagship
brand). The presence of other brands of the company is limited.

PLACE

The presence of fortune is limited when it comes to kirana stores.

Some store owners expressed that the company was active in promoting and
pushing the brand a couple of years back but now it does not do it.
Telangana issue in the region has also affected their business so they have
started keeping less number of brands. Company should push its brand to
encourage the shop owners.
The company has to target the small stores in order to have a good influence in
the future. Mostly purchases are made from the general stores ( kirana stores )
only.
The distribution network needs improvement if comparison is made with the
leader.

PROMOTION

The respondents were less aware of the brand due to less promotions made in
the stores.
Presence of the brand in the stores should be felt more.

26

CHAPTER 8
LIMITATIONS

The author of this report had to work under several constraints and limitations.
Some of the key limitations are:

The survey and research has been done only in Hyderabad, therefore the
results show the market position of Hyderabad only
The sample size of the Hyderabad region taken was small, therefore it can be
said that the chosen sample is not the representative of the whole
population .
Respondents may not have been true in answering various questions and
may have been biased to certain other questions.
The questionnaire mostly contained multiple choice questions, therefore
many respondents did not give a proper thought before the questions, and
some answered things which were not applicable. All this increased the bias.

27