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March 01 , 2015
Saraiwwalaa Agrr Refineries Ltd (SARL) has on offer more than 72 variants under different brands, while Naturralle is its flagship brand. The company has two fully automated state-of-the-art plants equipped with German technology for refining edible oils; one in Krishnapatnam (near Nellore) and the other in Maheshwaram (R R district). Anjani Kumar Gupta, director, Saraiwwalaa Agrr

Refineries Ltd, in an email interaction with Anurag More discusses in detail the edible oil industry in India and also throws light on his company’s products, future plans and so on. Excerpts:

What is your take on the edible oil industry in India? Do you see any shift?
The Indian edible oil industry was at 18.1 mn tonne in FY 14 and expected to increase to 23 mn tonne by 2019-20 growing at 4 per cent per annum. The edible oil market in India is fragmented with strong regional preferences. However there is a visible shift in consumer preference, as the consumers are getting more health-conscious and therefore demand for healthier sunflower oil, rice bran oil, soyabean oil and so on. The current sunflower oil market in India is over Rs 18,000 crore and growing at a rate of 10 per cent much faster than the edible oil industry. A similar trend is observed with rice bran oil.

How do you see the demand for edible oil in the near future?
India is one of the largest producers of oilseeds in the world and occupies a prominent position in terms of both acreage and production. In my opinion, sunflower oil’s growth is going to be escalating. With the sunflower oil contributing 11 per cent of the total edible oil consumption in the country at a steady growth rate of 10 per cent per annum, I see immense growth. Seventy per cent of sunflower oil is consumed in the southern states followed by west and east. Sixty-seven per cent consumption of sunflower oil is in the urban areas and the rest is consumed in rural areas clearly indicating a switch towards the health benefits of the oil. The market for healthier oils like sunflower, soyabean, and rice bran has tremendous growth potential.

What type of oil is being used mainly in food products?
India is a vast country and inhabitants of several of its regions developed specific preference for certain oils largely depending upon the oils available in the region. For example, people in the south and west prefer groundnut oil while those in the east and north use mustard/rapeseed oil. Likewise several pockets in the south have a preference for coconut and sesame oil.

Of late, things have changed due to the technological development for refining, bleaching and de-odourisation, all oils have been rendered practically colourless, odourless and tasteless and, therefore, have become easily interchangeable in the kitchen. Newer oils which were not known before have entered the kitchen, like those of palm oil, or the healthier sunflower, soya bean and rice bran oils.

How is the quality of oil being determined?
All the products manufactured by SARL are “Agmark” graded under licence from Government of India. At SARL quality of our products is of utmost importance. We have two refineries one at Krishnapatnam (near Nellore) and the other in Maheshwaram (Ranga Reddy district). Both the refineries use the state-of-the-art plant from Desmet Bellestra, Germany. This ensures the oil is consistently of highest international standard besides this all our products undergo stringent quality checks to ensure purity.

Tell us something about spurious oils available in the Indian market and how it affects food industry.
There is a big market for loose edible oil in India. Sale of loose edible oil is banned in states like Maharashtra. The sale of edible oil in unpacked, unmarked and unlabelled condition should not be encouraged as it gives in scope for adulteration and deterioration in the quality of oils. Customer consciousness can improve the conversion from loose to packaged oil.  

How are the government regulations for edible oil in India?
Government regulations favour edible oil refineries in the country. The government recently implemented the duty structure required by the industry, ensuring that the domestic refining industry remains competitive when compared to imports.

What type of packaging is used for your products? How safe is it for your product?
It is our constant endeavour to provide our customers with a user-friendly, innovative package like our unique sleek one litre pet bottle with a special cover that avoids spillage making it convenient for household use. For the larger customers we have recently introduced a 15L jar with a tap. The material used for the packing are completely safe for the oil.

Tell us about your product offerings.
Saraiwwalaa is the only edible oil company in south India to have more than 72 variants under different brands. Naturralle is the flagship brand of the company. Naturralle Refined Sunflower Oil and Naturralle Sona Masouri Rice are amongst the top brands in AP. Sree Krishna Gold and Krishna Brrand-R are the market leaders in its segment in AP. Naturralle Vanaspati is the market leader in Maharashtra. Specialty fats under the brand ‘Super’ are fastest growing in AP, Karnataka and Maharashtra.

Brief us about your expansion plans for the Indian market.

SARL is looking at a turnover of Rs 3,000 crore by FY 18. At SARL, the focus will be on establishing “Naturralle” as value for money brand and make it a leading player in the sunflower oil category. We plan to improve our market penetration in AP and Telangana. We also plan to improve the market presence and reach in the states of Maharashtra and Karnataka where the brand Naturralle was launched in 2014.

Besides increasing new geographies, we plan to create awareness on health benefits of sunflower oil through an extensive rural campaign and increase the rural consumption of “Naturralle.” This will further improve our penetration in the Indian market.

We also plan a series of activities and promotions to connect with the customers and ensure a better share of voice and improved share of mind trough a strategic mix of advertising, PR and BTL activations.

SARL also plans to introduce newer variants under “Naturralle” based on market growth and market volume to improve the product mix and sales. We plan to increase the contribution of branded sales  from 40 per cent to 60 per cent while retaining the volumes for the bulk segment.

There is a huge untapped market in the edible oil sector. Presently the per capita consumption of edible oil in India is very less as compared to the other global market which offers a great opportunity for expansion and growth. Our goal is to become a brand known for all varieties in edible oils. We wish to remain a south-focussed brand as there is a huge potential to expand our base here.

How much will you be investing for the expansion?

SARL is a Rs 2,000 crore company with asset base of Rs 250 crore. SARL has already invested Rs 50 crore in the last five years towards brand building activity. On further expansion, SARL is open to looking at forging strategic partnerships or buyouts to increase its presence across the country.

Any plans to launch new products in coming years?
SARL is exploring the opportunities of entering newer high growth categories in the edible oil segment like rice bran oil. They are also planning to launch groundnut oil and mustard oil which have a large consumption in select markets in India. SARL also plans to enter the branded food segment by launching atta and other food grains under the “Naturralle” brand.

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