KRBL Limited, India’s largest basmati rice exporter, is diversifying its portfolio by venturing into the blended edible oil segment, aiming to generate ₹200-300 crore in revenue from the new business vertical within the next two years. This strategic move is part of the company’s efforts to reduce overdependence on rice exports and leverage its strong distribution network across India.
KRBL’s New Business Vision
The company has launched two blended edible oil products under the brand ‘India Gate’:
- India Gate Super Healthy Blended Oil
- India Gate Gold Blended Oil
These products will initially be rolled out in North and West India, followed by phased expansion to the South and East in FY26. KRBL plans to offer a balanced blend of rice bran oil and refined soybean oil to cater to India’s growing health-conscious consumer segment.
KRBL Edible Oil Business Targets
| Particulars | FY26 Target |
|---|---|
| Revenue | ₹200-300 crore |
| Market Share (Blended Oils) | 3-4% |
| Distribution Reach | 1 lakh retail outlets |
| EBITDA Margin | 6-8% |
| Brand | India Gate |
Speaking on the launch, KRBL Joint Managing Director Anil Mittal said:
“With rising demand for blended oils driven by health benefits and price affordability, our entry will leverage India Gate’s strong brand trust. We expect to achieve ₹200-300 crore annual revenue within two years.”
Why KRBL Is Entering Edible Oils
- Portfolio Diversification: Reduces reliance on basmati rice exports, which are exposed to international price volatility and geopolitical restrictions.
- Leverage Brand Equity: India Gate is a household name in packaged foods, enabling easier consumer acceptance in edible oils.
- Health Trends: Rising demand for blended oils that combine taste, affordability, and heart health benefits.
- Supply Chain Synergies: Utilising existing warehousing, distribution, and retailer network for cost-efficient market entry.
Blended Edible Oil Market In India
| Segment | Market Size (FY24) | CAGR (Next 5 years) |
|---|---|---|
| Blended Oils | ₹20,000 crore | 8-10% |
| Total Edible Oils | ₹2.7 lakh crore | 5-6% |
Blended oils are gaining traction among Indian consumers as they combine the health benefits of multiple oils with cost-effectiveness compared to pure premium oils like olive or canola.
Key Competitors In Blended Oils
| Company | Brand | Market Share |
|---|---|---|
| Adani Wilmar | Fortune | 24% |
| Ruchi Soya (Patanjali Foods) | Mahakosh, Ruchi Gold | 16% |
| Emami Agrotech | Healthy & Tasty | 10% |
| Cargill India | NatureFresh | 8% |
| KRBL | India Gate (new entrant) | Targeting 3-4% |
Analysts believe KRBL’s entry will intensify competition in the blended segment, particularly in the northern markets where India Gate commands high brand equity.
KRBL’s Financial Performance Snapshot
| Particulars | FY24 | FY23 | % Change |
|---|---|---|---|
| Revenue (₹ crore) | 5,650 | 5,120 | +10.3% |
| EBITDA (₹ crore) | 940 | 865 | +8.7% |
| Net Profit (₹ crore) | 580 | 525 | +10.5% |
| Basmati Exports | ₹3,970 crore | ₹3,650 crore | +8.8% |
| Domestic Sales | ₹1,680 crore | ₹1,470 crore | +14.2% |
The edible oil business is expected to add incremental topline without major upfront capex, as KRBL is leveraging third-party oil refining and bottling partnerships for manufacturing.
Strategy For Edible Oil Growth
KRBL plans to:
- Price Competitively: Target blended oil price point of ₹110-130 per litre to attract mass consumers.
- Retail Push: Integrate edible oils into India Gate’s rice retail network of over 80,000 outlets, expanding to 1 lakh+ within a year.
- Brand Communication: Promote health benefits of blended oils through regional campaigns highlighting rice bran oil’s cholesterol-lowering properties.
- Innovation Pipeline: Evaluate fortified oils with vitamins A and D to cater to urban health-conscious consumers.
Management Commentary
Director Priyanka Mittal added:
“Our foray into edible oils complements India Gate’s packaged food strategy. Consumers trust us for purity, and we will deliver the same commitment in oils with transparent labelling and quality assurance.”
Challenges Ahead
Despite strong brand leverage, KRBL will face:
- Competitive Pricing Pressure: Market dominated by established edible oil giants with deep pockets.
- Volatile Raw Material Prices: Fluctuations in global soybean and rice bran oil prices affecting margins.
- Consumer Loyalty: Converting existing buyers of brands like Fortune or Mahakosh requires aggressive marketing.
Recent Strategic Moves By KRBL
| Initiative | Objective | Status |
|---|---|---|
| Expansion to Europe (Basmati) | Capture premium rice market share | Shipments commenced FY24 |
| Rice Bran Oil Extraction | Backward integration for edible oil | Evaluating capacity addition FY26 |
| Packaging Innovation | Smaller SKUs for Tier 2/3 towns | Launched 500ml & 1L packs FY25 |
| Digital Commerce | Boost online basmati sales | Revenue doubled in FY24 |
These initiatives align with KRBL’s Vision 2030 to transform into a diversified FMCG company beyond rice.
Analysts’ Take
Motilal Oswal stated,
“KRBL’s edible oil diversification is a strategic fit but execution and distribution efficiency will determine scalability.”
HDFC Securities added,
“Blended oils offer margin accretive diversification, leveraging India Gate’s trust. However, market share gains will be gradual amid intense competition.”
Social Media And Industry Reactions
The announcement was widely discussed on LinkedIn and Twitter:
- “KRBL’s entry into oils shows their FMCG vision beyond rice. Smart move.”
- “Edible oil market is crowded but India Gate brand may help penetration.”
- “Looking forward to India Gate oil. Health blends are the future.”
Conclusion
KRBL’s foray into blended edible oils marks a strategic pivot to transform itself from a basmati-centric exporter into a diversified packaged food and FMCG company. With a revenue target of ₹200-300 crore in two years, its success will depend on brand leverage, distribution efficiency, competitive pricing, and sustained consumer trust in quality and health positioning.
Disclaimer
This news article is prepared based on corporate announcements, market data, analyst insights, and industry reports for general business news dissemination. Readers are advised to refer to official filings and consult SEBI-registered financial advisors before making investment decisions.
