Godrej Agrovet Limited (GAVL), the agri-business arm of the Godrej group, has set a target of ' 300 crore turnover by 2015 from its palm oil plantation business.
“We will be implementing better technology to achieve this triple growth. The business has grown to the current Rs 100 crore turnover from ' 75 crore last year,” RR Govindan, vice-president, GAVL, said here while launching the leaf and soil analysis laboratory in the state at Vijayawada.
The company has invested Rs 20 lakh in the laboratory to help farmers improve productivity and profitability in palm oil plantations. It has targeted to reach a global benchmark of increasing its average production to 30-38 tonne per hectare from 19 tonne from mature (seven years) plantations.
The cost of production is very high. Fertiliser accounts for 40-50 per cent of the total production cost. “The palm oil business is very low in the initial years (1-3 years) and good profit margin comes only from mature plantations. We are in our initial stage and have covered only 40 per cent of the market,” he said.
Godrej Agrovet has 37, 000 hectares of palm oil plantation with 18,000 farmers in seven states across India. AP, being a major market, accounts for 70-75 per cent of the company total palm oil production, from 130,000-140, 000 hectares.
The total turnover of Agrovet is Rs 1,576 crore and is expected to grow around Rs 17,00 this year. GAVL has 45 manufacturing units, a network of 10,000 rural distributors, and over 1,900 employees across India.