Amul has been consistently growing at 15-18% in last decade

“The kind of outlook that we have for adding more products in our portfolio, working on developing the organic products business and a lot of other opportunities in expanding the cooperative network across the country, all this will help in maintaining, in fact, expediting the growth rate in the times to come,” says Jayen Mehta, MD, Amul. Let us get a sense as to what kind of growth you are pencilling in, because it has been 18% growth for FY23. What has really driven this? Has it been volume or value? And do you think that this 18% growth is here to stay? It is a pretty good time for the dairy industry in general and the cooperatives in particular. As you rightly mentioned, Amul GCF turnover this year grew by 18.5%, at about Rs 55,000 crores and the Amul brand turnover is about Rs 72,000 crores, making it the largest FMCG brand in the country. This has been driven by both value and volume and we have been consistently growing at about 15-18% over the last decade. So, for sure this volume is going to continue for a long period of time. The good part has been the return in demand post-COVID and that has been aiding the growth in all the consumer products that we work with.

And more importantly, the kind of outlook that we have for adding more products in our portfolio, working on developing the organic products business and a lot of other opportunities in expanding the cooperative network across the country, all this will help in maintaining, in fact, expediting the growth rate in the times to come.

You have recently taken charge as well as the new MD after Mr RS Sodhi. Just wanted to understand what direction do you wish to steer Amul in for say the next decade? See Amul is a 76-year-old brand. GCF, our organisation, is completing 50 years this year, and I have been here for the last 32 years. So, practically, this is an engine powered by 36 lakh farmers and the kind of volume and the distribution network that we have, I mean, the only direction we can move forward is one and that is upward. Having said that, as I mentioned, there have been positive times for the cooperative sector. The kind of support the government is giving to cooperatives across the country by recognising that cooperative is now a tool of development for upliftment of the people in the marginal section of the society. On one side, the government has already announced that they want to set up 200,000 more dairy cooperative societies across  India in addition to the 2 lakh current societies that we currently have. So, what happened in the last 50 years is going to happen in the next five years, which means more milk will flow into the organised sector and that will bring in more business opportunities for all the brands associated with cooperatives across the country.

More importantly, we are promoting two new multi-state cooperatives, one for exports and other for organics, which means all cooperatives in the country will get an international market access for their products. Amul, of course, is exporting to more than 50 countries, but here we are looking at large number of cooperatives across the country finding international market for their products. And the second is the organic initiative, where we will connect with organic producers and we have a brand for promoting organic products. So, these are the two great business opportunities that we are working with in addition to developing our dairy business.

I wanted to get your take regarding the prices, because the retail milk prices have soared, what, 15% in the last one year, the highest that we have seen in a decade. Where do you see the prices trending from here on because there have been a slew of price hikes taken by yourself as well. I think the point you made is right, but you do not look at just one year, you look at four-year period. Because from 2019 onwards, we had two years of COVID in which there was no price increase taken by anyone and then we had to take care of the increased inflation for our producers, increased cost of feed and fodder and the other issues related to milk production. So, the last one year was a bit abnormal, but if you look at in three to four years perspective, the price increase for milk for the consumers has been more or less in line with the inflation.

Having said that, the producers also have to be compensated for the increased cost and that is why we had to take very-very calibrated measures in increasing the price of dairy products. But now the situation is pretty good across the country and when the flush season in north ends, the flush season in south starts. So, we will see increased supplies of milk coming from the southern part of the country and obviously the next flush season for the north and west is also going to be superb.

So, things should be pretty good for the industry in general and I do not think there is much reason to worry on that point of view.