Marico divests refined sunflower oil 'Sweekar' brand to Cargill : Edelweiss

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Marico
Marico divests refined sunflower oil 'Sweekar' brand to Cargill (I) for an
undisclosed consideration
· Marico offered Sunflower oil through Sweekar brand, which was a non-focused brand for
the company
· Sweekar was ~5% of Marico’s sales and had wafer thin margins
· In edible oil, Adani Wilmar is positioning the sunflower oil product as less oil absorbent.
Marico had played this theme years back (through Sweekar brand in sunflower oil) and
had started focusing on the Saffola brand as good for heart i.e. health and wellness
platform (Marico’s Saffola variants have different combination of Safflower Oil, Corn Oil
and Rice Bran Oil).
Divesting of thin margin business is positive for Marico as it would lead to more focused
approach on core categories. We maintain ‘BUY’ on Marico.

Marico divests Sweekar to Cargill India :Angel Broking

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Marico divests Sweekar to Cargill India
Marico announced the divestment of its refined sunflower oil brand Sweekar to Cargill
India for `60cr (~0.6x to sales) as part of its decision to divest its non-core brands and
focus on premium brands focusing on wellness and beauty platform (Saffola and Kaya).
Sweekar is a strategic fit to Cargill’s portfolio, which has other brands such as Gemini and
Nature Fresh, catapulting the company into becoming the second largest player in India’s
sunflower oil market. With this deal, Cargill will have access to a ~50% market share of
sunflower oil in Maharashtra. The stock is currently under review.