Annapurna Group bets on tradition and innovation to cook up growth

Annapurna Group, the Assam-born FMCG brand best known for its ghee, has been part of India’s kitchens for over 70 years. As competition intensifies with national and regional players flooding the market, the company is betting on a mix of tradition, innovation, and stronger distribution to stay relevant. In a conversation with The Economic Times, Subir Ghosh, Managing Director of Annapurna Group, talks about the brand’s premium play in ghee, diversification plans, and the challenges of expanding beyond its Eastern stronghold. Edited excerpts.

The Economic Times (ET): Annapurna Group has been part of India’s FMCG landscape for over 70 years. How has the brand managed to stay relevant across generations?
Subir Ghosh (SG): Annapurna Group has remained a trusted name in India’s FMCG landscape for over 70 years by consistently evolving to meet consumer needs. In the FMCG sector, staying relevant means continuously innovating while staying true to your core values. For dairy products like Annapurna ghee, which are a staple in every household, we have focused on maintaining the highest standards of purity, quality, and taste. At the same time, we have adapted our offerings to changing consumer preferences and lifestyles, ensuring that our products remain accessible, reliable, and meaningful across generations.

ET: What role do traditional methods play in your product development today, given the advancements in food technology and manufacturing?
SG: While we embrace modern food technology and mechanized processes to scale production efficiently, traditional methods continue to play a central role in our product development. We ensure that the essence, character, and purity of our generational traditional products are kept intact. Advanced machinery and a well-qualified R&D team help us maintain consistency, meet growing demand, and commercialize these products without compromising their authentic taste and quality.

ET: What are the different products and items the group sells and which product contributes the most in terms of sales and revenue? Consumers today are spoiled for choice with dozens of ghee brands on the shelves. What makes Annapurna’s Gawa and Cow Ghee worth paying a premium for?
SG: Annapurna Group sells a range of products including ghee, fruit-beverages, and agro-based food products. Ghee is the top-selling product, contributing the most to revenue, followed by beverages and pickles.

While consumers today have many ghee options, what sets Annapurna Ghee range apart is the meticulous care we take in sourcing, processing, and packaging. With over 70 years of experience, we ensure that every batch retains its natural nutrients, authentic flavour, and purity.

Our ghee stands out for its granular ‘danedar’ texture and unmatched aroma, qualities that are carefully kept intact through precise churning and controlled boiling at the right temperature. We follow stringent processes to prevent any adulteration, ensuring that what reaches the consumer is not just ghee, but a true ‘superfood’, pure, wholesome, and consistent every time. This commitment to quality is why our ghee commands a premium and continues to be trusted in kitchens.

ET: Are there plans to diversify into new product categories that align with changing consumer lifestyles and preferences?
SG: Yes, we are actively exploring diversification into product categories that cater to evolving consumer lifestyles and preferences. Our focus includes staples, pulses, and nutritional or health-oriented drinks, keeping in mind the growing emphasis on wellness and convenience. Additionally, we plan to introduce blended spices in the near future, aligning with both traditional flavours and modern consumption trends.

ET: Annapurna operates plants in Assam, Bhutan, and Uttar Pradesh. What measures do you take to maintain uniform quality across geographically diverse facilities?
SG: At Annapurna, maintaining consistent quality across plants in Assam, Bhutan, and Uttar Pradesh is a top priority. We achieve this through a combination of stringent Standard Operating Procedures (SOPs), robust quality control measures, and a proactive R&D team. Every facility follows the same protocols from sourcing, processing, and packaging, ensuring that our products meet the same high standards regardless of location. Regular audits, process monitoring, and continuous training for our staff reinforce adherence to these standards, enabling uniform quality across all our geographically diverse facilities.

ET: Your core strength has been in Eastern and Northeastern India. What challenges have you faced while expanding into metros and Western markets like Maharashtra and Delhi NCR?
SG: Expanding into metros and Western markets has brought its own set of challenges. Building a robust distribution network across modern trade, e-commerce, traditional trade, and HoReCa channels has been complex, with each requiring a different approach. Competition is intense, with well-established national and regional players, and ensuring visibility, shelf space, and price competitiveness remains a constant task. Inter-channel price disparity adds to the challenge, as balancing margins across e-commerce, modern trade, and general trade is never easy. Additionally, consumer preferences and purchase behaviours vary across regions, so establishing our products requires not just strong distribution and marketing, but also adaptation to local tastes and dynamics.

ET: Do you see exports as a growth driver in the future, especially with the global demand for traditional Indian foods?
SG: Exports will definitely be a strong growth driver in the future, as global demand for authentic Indian foods continues to rise. However, at this stage, our primary focus remains on domestic expansion, where we see significant opportunities. Once we further strengthen our presence in the Indian market, exports will become a natural progression for scaling up.

ET: The government recently reduced GST on several products, including Ghee. What impact do you think this will have on your sales and will you reduce prices of products proportionately?
SG: The GST has been cut on ghee and several other products, and we’re happy to pass on this benefit to our consumers. We have already taken steps to reduce prices so that people can enjoy the same quality at a more affordable rate. We don’t see any negative impact on our business, in fact, we believe this move will encourage more households to choose our ghee and strengthen their trust in our brand.

ET: FMCG giants thrive on last-mile reach. How does Annapurna plan to scale its distribution network to compete with companies that already have pan-India penetration?
SG: Last-mile reach is indeed the backbone of FMCG growth, and we at Annapurna are focused on building a robust and future-ready distribution network. Our approach is threefold: strengthening our sales teams across regions, expanding distribution across traditional trade, modern retail, and e-commerce, and setting up strong channel partnerships to ensure product availability even in the most remote markets. Alongside this, we are investing in product awareness programs to build stronger consumer connect. Our recent association with Shehnaaz Gill as the face of Annapurna Cow Ghee is one such step, helping us create brand resonance while ensuring that our products are not just widely available, but also top-of-mind for consumers across India.

ET: Are you looking at modern trade, quick commerce, and e-commerce as serious growth channels, or will general trade remain your core distribution strength?
SG: While modern trade, e-commerce, and quick commerce are emerging as significant growth channels, general trade still continues to be the pillar of distribution in India. Currently, around 95% of consumption still happens through traditional trade. Our approach is channel-specific: in metros and Tier 1 cities, we actively leverage modern trade and e-commerce to meet evolving consumer preferences, while in Tier 2, Tier 3 and rural markets, we focus on traditional trade to ensure deep penetration and accessibility, aligning with local buying patterns. This balanced strategy allows us to maximize reach and visibility.