LT Overseas plans to invest Rs 40 cr, put up Torbed reactor

LT Overseas Ltd, one of the largest exporters of Basmati Rice in India under the brand name Dawat, has decided to invest nearly Rs 40 crore to modernise and upgrade its facilities.

The company has two rice processing units in Haryana at Sonepat and one at Amritsar in Punjab.

Talking to Business Standard, V K Arora, managing director, LT Overseas Ltd, said the company was exploring the possibility of putting up a Torbed reactor in collaboration with the Canadian government in order to use rice husk, by-product of paddy, in a productive way.

He informed that the company had the capacity to process 600 tonnes of paddy everyday. "And this," he said, "generates 120 tonnes rice husk a day."

With the help of Torbed Reactor, the rice husk will be burnt in such a manner that produces more silica than carbon in the ash.

According to Arora, the ash burnt under the new reactor would contain 18 per cent to 20 per cent silica that would be extracted and sold to cement manufacturers at substantial price.

However, the steam produced in the process would be consumed by LT Overseas, a brand registered in 40 countries. He informed that the company might also go in for biomass-based power plant in the near future.

Arora said the company recorded a turnover of Rs 400 crore in 2005-06 and has set the target of Rs 500 crore in the current year. "The exports contributed Rs 200 crore in the total turnover," he added.

The company is planning to roll out a new product, Dawat Flavour, that would be a combination of rice, lemon, mushroom and tomatoes, and fall in the fast food category.

LT Overseas is doing contract farming in an area of 30,000 acre in the districts of Amritsar and Gurdaspur. About 3,000 farmers are associated with them in Punjab. "We started contract farming about two years back with the help of Tata-promoted Rallies and the Punjab government.

At present, it is being done with the support from Tata Chemicals, Pepsi and the Punjab government," he said.

Arora said the corporate sector needed to develop a rapport with farmers to get returns from contract farming. Since Pepsi has been into contract farming of potato and kinnow since quite some time, it has been able to win the trust of farmers.

The company is also undertaking organic farming to meet the overseas demand. Arora said with rapid urbanisation, the demand for branded food products was increasing. This, as a result, also increased the demand for their brand by 15 per cent in the domestic market last year.

The company has a manpower of about 700 persons and is the only Indian company to have got the Hazard Analysis and Critical Control Point certification from the British Standard Institute.