Kwality icecream any news
Personally, I like the business more than I would chase the stock. But if you are looking at a 3–5 year horizon, KWIL is worth tracking closely, and ₹41–42 can be considered for a staggered position rather than an aggressive one.
Do national ice cream brands still matter everywhere? In my state, local ice cream brands dominate in popularity and availability. This reflects a wider trend: national FMCG products are steadily losing ground to state-level alternatives.
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Reliance is now entering the ice cream market to reduce the popularity and availability of your local brand.
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I have my doubts about their last-mile execution for the FMCG category. When my local Reliance Retail store opened ( multi storied and the largest supermarket in the town by square foot space), it drew huge crowds, but within two years, the cracks showed. They shut down half their refrigerators, and vegetable quality degraded. Staff actively avoid eye contact to dodge assisting customers, and the checkout counters are poorly designed for trolleys, forcing shoppers to pile items awkwardly. Even during the initial months of operation despite long queues, only one or two counters operate while the rest of the staff hide on the top floor. Between perpetual stockouts of their own Campa cola and poor merchandising, like stocking sugar next to salt, I believe if they continue to operate their franchises and outlet this way, their operational execution on the last mile FMCG products will ultimately fail.
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I think a lot of the fear around Reliance comes simply from the Reliance name people assume that once they enter a market, they’ll eventually dominate it.
But if you look at some of their recent forays, the execution and product quality haven’t always lived up to that expectation. Campa Cola, for example, is still quite sugary and hasn’t really managed to reach the product level or consumer preference of Coke or Pepsi.
For ice cream too, I don’t think lower prices and better distributor margins alone will bring repeat customers. Product quality and brand loyalty matter more.
There may be an initial bump due to lower prices and better margins, but in the long run, if other brands have better quality, customers will move back to them.
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