Income Tax Cut To Boost Urban Consumption, Drive Demand For Food Products: Adani Wilmar CEO
Finance Minister Nirmala Sitharaman during her Budget speech on Feb. 1 announced that individuals earning up to Rs 12 lakh a year will not have to pay any income tax.
The income tax cut announced in Budget 2025 will provide urban consumers with more disposable income, which they are likely to spend on essential goods, including food items such as those sold by Adani Wilmar, according to the company’s Managing Director and Chief Executive Officer, Angshu Mallick.
In a move to boost the slowing Indian economy, Finance Minister Nirmala Sitharaman, during her Budget speech on Feb. 1, announced that individuals earning up to Rs 12 lakh a year will not have to pay any income tax under the new tax regime. For salaried people, this exemption will apply to incomes up to Rs 12.75 lakh.
Talking to NDTV Profit, Mallick said that the urban middle class had been under financial stress.
“The urban middle class was surely under financial stress for several reasons. They were down spending on consumption; premium brands were not getting picked up,” he said.
The Adani Wilmar CEO mentioned that the industry did not expect so much tax cut.
“Everybody was thinking about what the budget will do. Normally, to put more money in the hands of the consumers, one would say they would cut taxes and all that. But this was a very big move, I would say. That's straight up to 12 lakhs per annum, if you will; there is no tax,” he said.
“Honestly, the trade or industry or companies like us, we did not expect to that extent,” Mallick added.
The tax cut will mean that the middle class will now spend more and is likely to spend money on products that Adani Wilmar sells.
“Now what does all this mean? This means that the tax deduction that happens every month from my salary will reduce and once it is reduced, then I have the option of where to spend it. Now consumers generally would first spend on food. And, basic foods are more important,” he said.
“We as a company feel that kitchen essentials, particularly our product range, pulses, wheat flour, poha, suji, and all those things, consumers would love to buy their own brand, and people will come out and do that,” Mallick added.
Shares of Adani Wilmar on Wednesday closed 0.6% lower at Rs 270.95 apiece on the NSE, while the benchmark Nifty 50 ended 0.18% or 42.95 points lower at 23,696.30.
