Patanjali picks Ruchi Soya for distribution partnership

Ruchi Soya Industries Ltd on Thursday announced the signing of a memorandum of understanding with Yoga Guru Baba Ramdev-promoted Patanjali Ayurved Ltd for an exclusive sales and distribution arrangement for the entire range of Patanjali edible oil in large packs.

Under the terms of the MOU, Ruchi Soya will use its own extensive distribution network to sell the complete range of Patanjali edible oils in large packs across all regions of India.

Ruchi Soya will have exclusive distribution rights for the existing as well as future range of Patanjali edible oils in large packs. The MOU will be followed by signing of a detailed service agreement for an initial period of three years, similar to the previous processing and packaging agreements concluded between Ruchi Soya and Patanjali Ayurved earlier this year.

''We welcome this expansion of our relationship with Patanjali Ayurved. The MoU for exclusive distribution of large packs with Patanjali Ayurved is testimony to the intrinsic strength of our distribution network and successs of the manufacturing and packaging arrangement between the organisations. Not only will Ruchi Soya's widespread distribution network ensure availability and sales of Patanjali's large packs range; this agreement will further lead to better utilisation of Ruchi's manufacturing capacity and significantly contribute to cost-efficient operations and augment profitability,'' Dinesh Shahra, managing director and CEO of Ruchi Soya Industries, said.

''The significance of this agreement can be ascertained from the fact that Patanjali is eyeing sales of Rs20,000 crore by 2020 from its edible oils range, of which large packs will constitute a substantial portion. For Ruchi Soya, this exclusive agreement will not only help manage optimum plant capacities but will also enhance profitability; boost productivity and efficiencies of our sales and distribution system across the country due to enhanced volume throughput,'' Satendra Aggarwal, COO, Ruchi Soya Industries, added.

''The edible oil brands of Patanjali and Ruchi Soya (like Mahaksoh and Sunrich) operate in premium and popular segments, respectively, and hence are non-competitive.''

Ruchi Soya's sales and distribution system ensures that its brands are available in more than 1 million outlets across 4,000 towns in general trade; in addition to its extensively coverage of modern trade outlets, institutions and the Horeca (Hotel/Restaurant/Catering) segment.

With brands like Nutrela, Mahakosh, Sunrich, Ruchi Gold and Ruchi Star, Ruchi Soya is a leading agri and food FMCG company with a turnover of $3 billion.

The company enjoys leadership position in soy foods and cooking oil segments of the country.

An integrated player from farm to fork; the company is also among the pioneers of oil palm plantations in India. Ruchi Soya is also one of the top exporters of value added soybean products like soy meal, textured soy protein and soy lecithin.