Amul Products -The Taste that Inspires India to Celebrate Life
Sodhi, the Managing Director of GCMMF, which owns Amul as the Asia’s largest milk brand has mentioned to the media that they have sent a presentation to the Finance Minister, earlier this month that Dairy Cooperatives, solely involved in the improvement of the Dairy Industry should be exempted from transfer pricing. This is because due to the fact that transfer pricing is to be made applicable where the motive of the organization is to make profit. Unlike such organizations, in Amul, the farmers are prioritized over profit and are served as members.
So transfer pricing serves no purpose where the sole moto of the organization is for the welfare of its members. Also in the coming months, this industry is going to face export challenges in dairy products as drought conditions are prevailing in New Zealand, the largest exporter of dairy products, Australia and Russia, scaling back imports by 50% due to the Ruble depreciation, lower Chinese purchases and the Abolition of National Production Quotas which is to be set by the European Union will undoubtedly create a global impact on Amul products. But this will not affect this industry to a large extent as it is yet to fulfill its domestic demand; it is constantly expanding its operations, prices being higher than the export markets.
As such, the GCMMF is investing Rs.50, 000 crores to set up 10 new processing plants in the next three years. Amul products will become a Rs.30, 000 crore in the current fiscal, which is near to Hindustan Unilever Limited. It is learned from the statistical data, that in April 2013-14, GCMMF’s annual turnover was Rs.18163.66 crore, despite the fact that their individual Dairy Unions did sales of Rs.6000 crore in their respective districts under the brand name Amul products without transacting through GCMMF, as such it was added up to as Rs.24000 crore. Out of the newly plants planned, two would be in Delhi, three in U.P, one each in Kolkata and Maharashtra and the remaining rest in Gujarat, presently it is having over 50 plants in India Gujarat Cooperative Milk Marketing Federation (GCMMF), which is a marketer of Dairy products under the reputed brand name Amul products is planning to receive Rs.50, 000 crore turnover.
The company is sighting a Rs. 22,000 crore turnover in FY15.The Managing Director of Amul, RS Sodhi, reportedly told that their capacity would increase by 90 Liters per Day by 2020 from 230 Liters per day to 320 Liters per day. At present it is currently procuring 19 Million Liter per day for processing against a payment of Rs.550-580 Kg per fat which is 12% more comparatively.
Of Late, GCMMF launches a new ice cream brand named Epic which leave a lingering taste among the people of our country at a time when Hindustan Unilever Limited launched its new ice cream brand on Wednesday in New Delhi.
It has been eventually claimed by the top brands that Belgian Chocolate is the key ingredient for Ice cream. Amul products will succeed when it will sell its ice cream, Epic priced at Rs.35 and Rs.40 against Magnum, an ice cream product of HUL which only available at Rs. 85 a bar.
As such, it has been made available to all people irrespective of rank and file. Competitively, Magnum which accounts for 2% of the revenue of the Hindustan Unilever Limited took birth in respect of being first marketed in in India on Chennai, two years ago which later expanded to Mumbai, Hyderabad, Pune and Bangalore. Also, Magnum is being represented by the leading Actresses, Eva Mendes, Eva Longoria and Liv Tyler as the royal brand to be known as ever of the Unilever, being amongst the few to be imported and sold in the country. As such the country’s organized IceCream segment is estimated at over Rs.2000 crore, with Amul holding a share of more than 40% in it. Also, Sodhi added that, Amul products is having plans not to hike milk price in the coming 4-5 months.
This is due to stability occurred in the feed prices, low energy costs and transportation costs respectively. Also the average increase in the price of milk in the current fiscal is around 5 -6%, which is economically lower than 10-12 % in the previous two years period of time, Sodhi added.
Due to a sudden crash in the prices of the essential commodities, private dairies are not procuring milk. As such it has compelled Amul products to buy milk from Gujarat and other parts of the country, to an increased rate at 195 lakh liters per day from 155 lakh liters per day due to the policy of Amul in providing better incentives to the farmers in contrast to other Private dairy organizations.