Can Adani do with apples what Mahindra did with grapes?

**Rishabh Varghese** (0:00)
In mid-August every year, Himachal Pradesh's apple harvest peaks. At the same time, trucks begin lining up outside Adani Agri Fresh's controlled-atmosphere storage facilities in Ruru. Farmers arrive with blue crates stacked high with apples, hoping that they can secure a slot before the warehouses fill up. Inside, the fruits enter something of a near-hibernation state. Oxygen levels are lowered, temperatures hover around freezing, and the nearly 25,000 metric tons of apples can remain fresh for up to 10 months before being released into the market when prices are higher. For nearly two decades, this has been the business of Adani Enterprises' agricultural arm. Buy apples, store them and sell them during the off-season. But that ambit has just widened for them. On 9th May, the company announced its expansion into cherries, plums and peaches. All fruits that are actually more perishable and more dependent on refrigeration and fast logistics than apples. Now other conglomerates have their own fruits of choice as well. For example, Reliance has a mango orchard in Jamnagar with over 130,000 trees. Even Mahindra Group has its own grape export supply chains. Meanwhile, ITC has been expanding its fresh fruits business as well, as part of a 20,000 crore rupees push across its FMCG and agri businesses. But the thing is, for Adani, fruits themselves were never the main play. The play has always been infrastructure, the hypercooling facilities, the grading mechanisms and the long haul transport. But now, the India-New Zealand Free Trade Agreement, which was finalized this April, has made this infrastructure even more indispensable. As the import duty on New Zealand apples drops to 25%, Indian apple growers are going to need all the help they can get. And Adani Agri Fresh is ready and waiting.
Welcome to Daybreak, a business podcast from The Ken. I am your host, Rishabh Varghese. And every day of the week, my co-host Snigdha Sharma and I will bring you one new story that is worth understanding and worth your time. Today is Friday, 12th June.
One executive said that fruits were never part of Adani's core strategy. They told my colleague, The Ken reporter Sakshi Sadashiv, that Adani is in the port's power and airport's business, and apples are hard to fit in there. But still, the company has a way of finding itself in sectors of national strategic importance. And this time, it found itself a nice little spot in a different, though equally essential, part of the economy.
You see, Gautam Adani actually began exploring what executives internally described as an exotic fruits opportunity all the way back in the early 2000s. And Himachal Pradesh, India's apple-producing state, was a good place to start building post-harvest infrastructure around horticulture. Another executive told Sakshi that back then, imported fruits such as avocados, kiwis and premium apples were still relatively uncommon in the Indian market. That was how Adani Agri Fresh Limited began. It now builds one of India's largest controlled atmosphere or CA storage networks under a government-backed horticulture subsidy scheme. The company operates roughly 25,000 metric tons of CA storage capacity across three facilities in Himachal Pradesh, in Rampur, Sanjh and Rooroo. That's well above the 5,000-10,000 ton range that's typical for other players in the space, by the way.
On top of that, two industry executives claim that more recently, Adani Agri Fresh has leased three additional hydro-cooling facilities to accommodate its expansion into stone fruits I mentioned earlier.
In the first nine months of FY26, the company's operating income was around 110 crore rupees with a profit of almost 3 crore rupees. A year earlier, it posted an operating income of around 180 crore rupees, but at a loss of about 9 crore rupees.
Now it's definitely a tough business. Margins are thin, procurement costs fluctuate with weather, storage is capital-intensive, and the fruits remain highly perishable despite the refrigeration. And even within apples, not every variety makes economic sense. AAFL or Adani Agri Fresh Limited almost exclusively procures mid-range varieties. These are red enough to sell well in the fruit mandis, but still firm enough to survive long storage periods. That's because lower-range fruit spoils too fast. While premium apples from places like Kinnor, which is at a high altitude on the other hand, even though they're sweeter, juicier and visually superior, hold too much moisture. And that makes them difficult to store for longer than a few weeks. One of the executives quoted earlier explained that they had actually tried to store Kinnor apples a few years back. But they ended up pulling out because it was very difficult to retain their quality post-storage. You see, the economics of the business hinge almost entirely on shelf life. The apples bought in August to September are stored for months before being gradually released into the market. But India's structurally weak yields make the whole thing a lot harder. Sanjay Agarwal, Managing Director at Devbhumi Gold Chain, which is a coal chain and fruit distribution company, said that India's crop is not the best in the market, and that it doesn't produce nearly the kind of yields global players do. To put that in perspective, New Zealand orchards yield 50 to 70 tonnes per hectare.