Ruchi to buy closed Ujjain unit

Ruchi Soya Industries Ltd, manufacturer of edible oil and soya foods and one of the largest domestic agri business companies, has plans to take over a closed unit in Shujalpur (Ujjain). The company will invest Rs 26 crore in the venture to produce soya and solvent extraction.

According to sources, Ruchi had acquired the firm in September 2004 for Rs 2.66 crore. Later it invested Rs 11 crore in the firm in a phased manner. The total investment will go up to Rs 26 crore, for which a proposal is under consideration.

Ruchi produces high-quality edible oils, vanaspati, bakery fats, and soya foods. Ruchi Soya is also the highest exporter of soya meal and lecithin from India.

"The total investment to revive the sick unit will be in a phased manner. Ruchi has asked for sops and concessions, including an investment promotion assistance of Rs 25 lakh, tax exemptions up to 11 years, mandi tax exemptions for 11 years. The apex committee on investment is considering the proposals. However the sops and concessions will be offered in accordance with industry policy," a government source told Business Standard.

But senior officials have told BS privately that Soya is in the negative list of investment in Madhya Pradesh, hence sops and concessions in take over leaves remote possibilities. The expansion of Ruchi will create 605 jobs.

Ruchi group has soyA products like soya chunks, granules, soya oil, flavours and soya flour. The Nutrela is the largest selling soya brand of the group in the country today.

While edible oil brands like soyumm (soyabean oil), Ruchi Gold (Palmolien Oil), Sunrich (Sunflower Oil) and Mandap (Mustard Oil) are leaders in the segment.

The soyabean processing industry is passing through a transition phase in Madhya Pradesh.

According to soyabean processors association of India the state has an installed capacity of 17 million tonne, while the availability of raw material is about 5.5 million tones. The capacity utilisation in the state comes to about 35 per cent only.