Adani To Invest Rs 1,000 Cr In Fruits And Vegetables

New Delhi: Adani Agrifresh plans to invest Rs 1,000 crore in the next three years to create a supply chain from farmgate to retailers of fresh fruits and vegetables, aimed at becoming a major player in the organised segment.

"We have plans to invest Rs 1,000 crore in the next three years to set up cold chain, pack houses, distribution centres and in expansion of capacity of present facilities," company's President Ravindra Jain told PTI.

Adani Agrifresh, a subsidiary of Adani Enterprises, has already invested Rs 200 crore to set up three state-of-the-art controlled atmosphere cold stores and grading and packing houses with a combined capacity of 18,000 tons in Himachal Pradesh for apple trading.

The company has increased its procurement of apple by more than three-fold to 18,000 tons this year from 5,000 tons last season, when it first entered the market.

Outlining the company's future strategies, Jain said Adani Agrifresh aims to become a long-term player in the perishable fruits and vegetables sector, where the investment is very high and margin low.

"Volume is the most critical factor in this business where investment is high and margin is low," he said.

The priority is to build a distribution network across the country to supply fresh fruits and vegetables throughout the year, he added.

"We first started with apple last year and this year added grapes, pomegranate, orange, litchi and cherries," Jain said, adding that the company would venture into vegetables segment two years down the line.

He said the company chose apple to start its business as the fruit has a potential of being in stores for a longer time through technological interventions.

The company is adopting several models to sell the fruits it procures directly from farmers without entering into any contract with them.

Jain said the company has tied up with wholesellers in 20 cities, besides selling the product to organised retailers like Reliance.

"This year we have not tied up with retail chains as we hope to start the marketing of apple soon. Last year, we supplied to Reliance Fresh, Mother Dairy, Food Bazaar, Big Apple, Choupal Fresh, Trinetra and Namdhari," he said.

Adani Agrifresh is also exploring the option of exporting the fruits and vegetables, though it feels the domestic demand itself was very huge that needs to be tapped.

India consumes about 90 million tons of fruits and vegetables annually, Jain said.

The company also intends to enter into cash-and-carry model by setting such stores at the planned distribution centres.