### **Overview** Modi Naturals Limited (MNL), established in 1974 and headquartered in New Delhi, is a leading Indian consumer goods company operating at the intersection of wellness, nutrition, and sustainable FMCG innovation. Listed on the BSE since 1985, the company has evolved from a commodity-focused edible oil processor into a diversified, multi-brand FMCG player with a strong presence across premium edible oils, healthy food products, indulgent snacks, and green energy via grain-based ethanol. With over five decades of experience in agri-processing and deep supply chain integration, Modi Naturals is strategically transforming its portfolio to capture growth in high-margin, fast-evolving consumer categories while leveraging its expertise for scalable profit centers. --- ### **Core Business Verticals** The company operates through **three primary business divisions**: 1. **Consumer Goods Division** 2. **Bulk Edible Oil & Feeds Division** 3. **Ethanol Division (via wholly-owned subsidiary Modi Biotech Pvt. Ltd.)** --- ## **Strategic Transformation: From Oil to Multi-Brand FMCG Powerhouse** ### **1. Consumer Division – Flagship Brands & Innovation Engine** Modi Naturals’ branded consumer business, centered on health and wellness, has emerged as a core growth driver. The division is anchored by its flagship **Oleev** brand—India’s No. 1 brand in the “Goodness of Olive Oil” category and the country's **third-largest super-premium edible oil brand**. #### Key Brands: - **Oleev**: Premium cooking oils combining olive, rice bran, and canola oils. Variants include: - *Oleev Active* (scientifically formulated for heart health) - *Oleev Health*, *Smart*, *Gold* - **Oleev Kitchen**: Healthy convenience foods including: - **Pasta** – 100% maida-free, available as macaroni and spaghetti; premium multigrain version made from four grains (chickpea, jowar, brown rice, durum wheat) - **Peanut Butter** – gluten-free, high-protein; includes *Oleev Junior* (chocolate flavor, targeted at children aged 4–13), currently in pilot and scaling phase - **PIPO Foods**: Indulgent snacking brand featuring: - **Popcorn** – Microwave-ready with “Taste Bomb” seasoning sachet in Indian-inspired flavors: Peri Peri, Cheese Burst, Tomato Salsa, Tandoori Twist - **Flavored Roasted Peanuts (RTE)** – Five ready-to-eat variants launched as a new category under PIPO - **Taste Bomb**: Standalone sub-brand for **instant seasoning mixes** (e.g., Magic Masala, Pasta Masala, Tandoori) across multiple cuisines - **Jynx**: New ready-to-mix powdered beverage brand introduced in 2024–25, now in soft-launch and early scaling phase (flavors: mango, orange, ice tea-lemon, mojito; enriched with Vitamin C) #### Distribution Reach: - Direct presence in over **50,000 retail stores**, served by **450+ distributors** - Pan-India footprint across: - Traditional general trade - Modern retail (3,000+ outlets) - E-commerce (Amazon, Flipkart, BigBasket, JioMart) - Quick-commerce (Blinkit, Zepto) — now contributes ~15% of top line - Canteen Stores Department (CSD) — a significant B2B channel for armed forces and government institutions #### Marketing & Brand Visibility: - Appointed **Karishma Kapoor** as brand ambassador in FY25 to enhance engagement and visibility for Oleev - Previously associated with **Lara Dutta** for Oleev olive and multisource oil lines - Above-the-line advertising spend increased to **7% of revenue in FY25**, with plans to double again by FY26 - Executing 360-degree campaigns across digital, TV, and social media, especially targeting Gen-Z and health-conscious families #### Growth Trajectory: - Consumer-branded segment continues to gain traction, driven by product innovation and expanded distribution - Non-oil food products (pasta, peanut butter, popcorn, beverages) are key pillars in **mitigating seasonal demand slumps** in edible oil, particularly during summer months --- ### **2. Bulk Business Division – Recovery & Resilience** Once challenged by government-imposed price controls and inventory corrections (2022–2023), the **Bulk Edible Oil & Feeds Division** has shown strong signs of recovery: - Returned to profitability in FY25 with **positive EBITDA of Rs 1.7 crore**, reversing a Rs 9.2 crore loss in FY24 - Despite a 16% revenue decline (to Rs 158 crore), improved performance driven by: - Softer commodity prices - Stronger monsoon leading to better crop inflows - Stabilized oil markets - Supply chain efficiencies #### Product Portfolio: - **Rice Bran Oil** (branded and non-branded) - **Rice Bran De-Oiled Cake** – Used in poultry and aquaculture feed; higher-protein variant developed and sold domestically and internationally - **Rice Bran Wax** – A specialty by-product with niche industrial applications #### Strategic Importance: - Acts as a **mature, cash-generative business** with stable margins - Provides backward integration advantages and hedges against volatility through long-term supplier-customer relationships --- ### **3. Ethanol Division – A Scalable Green Energy Play** Marking a bold diversification into renewable energy, Modi Naturals launched **grain-based ethanol manufacturing** through **Modi Biotech Pvt. Ltd.**, aligning with India’s **Ethanol Blended Petrol (EBP) Programme** targeting 20% blending by 2025. #### Key Milestones: - **First commercial greenfield grain-based ethanol plant in Chhattisgarh** commissioned in **November 2023** - Initial capacity: **130 KLPD (KiloLiters Per Day)** - Phase II expansion underway: **+180 KLPD**, targeting total capacity of **310 KLPD by Q3 FY26** - Total CAPEX estimate: ~Rs 250 crores (~Rs 150 crores in Phase I, Rs 100 crores for Phase II) - Engineering complete; construction scheduled to begin in FY25 and ramp up by FY26 #### Operational Advantages: - Proximity to high-yield grain-producing regions in Chhattisgarh (3 crop cycles/year) - Access to surplus and damaged food grains (including rice allocated under government programs) - On-site **5.5 MW cogeneration power plant** using rice husk reduces fuel costs - Close to major **oil marketing depots**, minimizing logistics expenses #### Market Traction: - Secured an **ethanol supply contract worth Rs 300 crore** from multiple Oil Marketing Companies (OMCs) for 41,600 kL (Nov 2024–Oct 2025), fully utilizing current capacity - Ethanol Division generated **Rs 9.1 crore EBITDA in FY24**, with FY25 EBITDA projected at **Rs 50 crore**; PAT expected to turn positive at **Rs 30 crore** - EBITDA margins ranged between **12–15% in FY25** - Considered a **scalable profit center** with long-term value creation potential #### No Demerger Plans: Despite strong standalone performance, the company is evaluating options for value unlock but has **no current plans for demerger** of the ethanol business. --- ## **Manufacturing & Infrastructure** - **4 Manufacturing Units**: 1. **Pilibhit, UP** – Solvent extraction and oil refining (established 1974) 2. **Sonipat, Haryana** – Snack packaging (PIPO) 3. **Hyderabad, Telangana** – Olive oil bottling 4. **Raipur, Chhattisgarh** – Grain-based ethanol distillery (greenfield project under Modi Biotech) - Fully backward-integrated model for Oleev, ensuring quality control and margin stability - Strategic asset-light approach; will consider backward integration only when scale justifies cost and improves margins (e.g., pasta manufacturing) --- ## **Product Portfolio at a Glance** | **Segment** | **Brands** | **Key Products** | |------------|-----------|------------------| | **Premium Edible Oils** | Oleev, Rizolo, Miller Canola, Olivana Wellness | Multi-source oils (Olive + Rice Bran), Olive Oil, Canola Oil, Rice Bran Oil | | **Healthy Foods** | Oleev Kitchen | Maida-free pasta, high-protein gluten-free peanut butter, multigrain pasta | | **Indulgent Snacking** | PIPO | Flavored popcorn, "Taste Bomb" seasonings, RTE roasted peanuts | | **Ready-to-Mix Beverages** | Jynx | Powdered mixes (mango, orange, iced tea, mojito), Gen-Z focused | | **Instant Seasonings** | Taste Bomb | Magic Masala, Tandoori, Pasta Masala, Italian Herbs | | **Ethanol (B2B/Bulk)** | Modi Biotech | Grain-based ethanol (310 KLPD by FY26) | | **Commodity/By-products** | Non-branded | Rice Bran Oil, De-Oiled Cake, Rice Bran Wax | --- ## **Strategic Priorities (2024–2026)** 1. **Transform into Multi-Brand FMCG Player** - Increase share of **branded sales** (especially non-oil categories) - Expand product range in **fast-growing niche segments** (health snacks, RTE foods, functional beverages) 2. **Focus on Food Portfolio Growth** - Scale **Oleev Kitchen** (pasta, peanut butter), **PIPO** (snacks), and **Jynx** (beverages) - Launch innovations: child-centric peanut butter, multigrain pasta, flavored roasted peanuts 3. **Leverage Distribution Network** - Utilize existing pan-India infrastructure (including CSD, Q-Commerce) for rapid rollout of new products - Balanced omnichannel presence with growing emphasis on digital channels 4. **Scale Ethanol Business** - Complete second-phase expansion to 310 KLPD by Q3 FY26 - Capitalize on government support, stable offtake, and rising fuel blending mandates 5. **Build Brand Equity** - Increase A&P spends from 7% to **~14% of revenue by FY26** - Explore integrated celebrity endorsement across categories 6. **Sustainability & Innovation** - Align with national goals: green energy, farm income support, waste grain utilization - Invest in R&D for health positioning, packaging innovation, and functional benefits --- ## **Key Competitive Advantages** - **First-mover in India's grain-based ethanol space** - **Only company producing multi-source olive oil** (olive + rice bran blend) - **Largest processor of rice bran in India** (multiple-year recognition) - Strong **backward integration and agri-sourcing expertise** - Pan-India **FMCG distribution across all key channels** - Asset-light model with **low production costs and strategic location benefits** ---