Amul IPO: From milk to butter to curd, people buy Amul in every household. “Amul – The Taste of India” is not just a brand but an example of the strength and pride of millions of farmers. But do you know that despite being such a big company, Amul will never be listed in the stock market? Meaning this company will never launch its IPO. There is an IPO of Dodla Dairy and many other brands. Soon Milky Mist Dairy Food will also bring its IPO. Now you might be wondering why this is so?
Let us tell you that Amul is not an ordinary company, it is a cooperative society, whose owner is not any big industrialist, but more than 30 lakh small farmers of Gujarat. Let us tell you how special is Amul’s business model and why it cannot launch an IPO.
What does cooperative mean?
How much benefit do farmers get?
If you buy ₹ 50 liters of milk from the shop, the farmer gets the entire ₹ 40 out of it. That means 80% of the money goes directly into the farmer’s pocket. In foreign countries it is only around 35%. The rest of the money is eaten up by the big corporate people there. Not so with Amul. This is the reason why every farmer of Gujarat considers Amul as his own. Schools, hospitals, roads, water tanks in the village – all are built with Amul’s money. This is not just a milk business, it is a business of village prosperity.
Why can’t Amul launch IPO?
IPO means that the company collects money from the public by selling its shares. But if Amul does this then the ownership rights of the farmers will be reduced. People from outside who are rich and have high income will buy its shares, farmers will become a minority. Outside investors would like to increase prices to seek quick profits and are unable to focus on reducing expenses. Then farmers will get less money. The objective of Amul will also change due to this.
Amul model has always been praised all over the world. This is called “White Revolution”. Started in 1946 by Dr. Verghese Kurien (Father of Amul). Today Amul is the world’s largest dairy cooperative. Turnover of more than ₹72,000 crore, exports to more than 50 countries, but the owners are still the same farmers. No outside shareholders.
If Amul had brought IPO then milk would have become expensive. After this, farmers would get less money, due to which the development of the village would stop. The trust of Amul which has been built for 75 years would have been broken. But the essence did not change. Even today she keeps the farmer’s profits in mind.
Some big cooperative companies in India have been listed in the stock market. Most cooperatives do not launch IPO to raise money. They take loans from banks, sell bonds, or form separate small private companies. The original cooperative never sells its shares, it lists only the new subsidiaries. This brings in money and there is no control over the farmers.
Amul has also adopted the same smart method. It forms a separate private subsidiary or joint venture for new business. The bank takes money from loans, bonds or private investors. If necessary, only a small company can put its shares in the market, but the real Amul Cooperative will always be of farmers.
