Meghmani targets 20% rise in its exports

Meghmani Organics Ltd (MOL), an Ahmedabad-based pigment and agro-chemical manufacturing company, is expecting a 20 per cent growth in its exports of agrochemicals.

The company is listed on Singapore Exchange (SGX) and has been exporting to 58 countries across the world. Around 70 per cent of the company's total revenue comes from exports.

The company is expecting a major demand for its public health pesticides formulations after the World Health Organisation (WHO) clears its application to supply the products in WHO's Malaria Eradication Programme.

Talking to Business Standard, Jayanti M Patel, Chairman and Managing Director, MOL, said, "We are expecting around 20 per cent growth in our agro-chemical exports in the near future as the demands are increasing. At the moment 50 per cent of our total produce of agro-chemicals is exported. Our aim is to increase exports to 70 per cent. The demand of agro-chemicals is on the rise in most of the countries where we are presently exporting our products. We produce around 8,000 MT of agro-chemicals which will increase to almost 15,000 MT per annum after the expansion."

The company will be setting up a new multipurpose agro-chemicals plant at Panoli, Vadodara.

However, the company expects a major growth in its pesticides exports from African countries.

"We expect a major increase in the demand of our public health pesticide formulations from African countries. We have registered our public health pesticides products in the Malaria Eradication Programme of WHO. Once the products are approved a whole new demand for our products will emerge from the African countries. That will also boost up our exports business," Patel said.

Talking about the global market of agro-chemicals, Patel said, "The global market size for the agrochemicals is $31 billion and it is increasing at the rate of 5 to 10 per cent. However, India lags behind other countries in the usage of agro-chemicals and is the 13th largest market of the world. Indian usage of agro-chemicals is only 570 grams per hectare while other countries' usage is between 1 kg to 4 kgs. However, demand is also increasing in the domestic market and more awareness level is increasing in the domestic market also."

The company produces three categories of agro-chemical products which includes technical grade pesticides, pesticide intermediates and pesticide formulations used in crop protection and non crop applications.

In non crop applications public health, termite and insect control as well as veterinary applications are included. Meghmani supplies its products to various multinationals including the Flint Group GMBH, Micro Flo Company LLC, Valent USA Corporation and Sun Chemicals among others.

Talking about company's future prospects in exports Patel said, "We already have about 90 registrations across the world for our agro-chemicals business and 415 registrations are pending in 56 countries. When these registrations are approved by the authorities we will have a larger reach. About 70 per cent of our revenues come from exports. Our turnover for 2006-07 was Rs 472 crore."

The company, which has 4 manufacturing facilities will add two more facilities, one each for pigment manufacturing and agro-chemicals. The pigment plant will come up at GIDC Vatva in Ahmedabad, while the agrochemical plant will come up at Panoli.

The company plans to raise Rs. 102 crore through its initial public offer which opens on June 4. The amount will be used in funding the new projects.