Ahmednagar-based Prabhat Dairy Pvt Ltd is on an expansion drive. The private equity-backed company has formulated a major plan to further boost its value-added segment of the dairy business. The ?950-crore company which is already converting 70 per cent of its total milk processing capacity of 8 lakh litres per day into value-added products, is aiming to strengthen its consumer product basket with more indigenous products like ghee, dahi, paneer, lassi and butter milk, with focus on the retail customers. Currently, it supplies 70 per cent of its value-added production to institutions which include big names like Mondelez International (Cadbury), Britannia, ITC, Mother Dairy, Abbott and Nestle. Boasting the largest condensed milk capacity of 4,000 tonnes per month, it is a dedicated supplier to Cadbury. In fact, Britannia outsources its entire requirement of yogurt in Maharashtra from the company. The company sells its products under brands such as Prabhat, Flava and Milk Magic and even exports to the US, UK and Africa. It has received ?140 crore from India Agribusiness Fund (iaf) and French development finance institution Proparco. Of this, IAF, a private equity fund sponsored by Rabobank group invested ^80 crore in 2012. Both the entities together hold 37 per cent stake in the company that is also planning to go public soon.
Banking on success
Banks are queuing up to tap the IPO market. Catholic Syrian Bank is one such bank which is readying itself for its maiden debut on the bourses. Anand Krishnamurthy the new MD and CEO, who had replaced Rakesh Bhatya sometime in January this year, is believed to have put listing of this Thrissur-based bank in Kerala on the top of his agenda. Bhatya had, prior to his resignation, picked up 1 per cent share at an estimated price of crore valuing the bank at ?600 crore then. While the biggest shareholders include the Chansri-Chawle family from Bangkok, recently others have picked up stakes. Kerala businessman Yusuffali M.A., who runs the largest retail chain Lulu Centre in the UAE, holds a little less than 5 per cent, with Edelweiss also holding a similar number. The Kerala-based Muthoot Papachan group is also a sljareholder. The success of this issue could see the RBL Bank also speed up its listing.
The healthy way
Delhi-based Best Foods, a ?2,400 crore company (chairman: M.P. Jindal) engaged in the production of packaged basmati rice is planning to make a big splash in the domestic market.
The company which has 18 factories processing rice is planning to increase its retail outlets from 250 to at least 350 across India in the current fiscal, by investing in health and wellness stores. A differential pricing strategy to promote rice in retail packs ranging from ?90-200 per kg are sought to be sold in these outlets. Promoting rice along with nuts and honey, the company is planning to dispel rumours that eating rice is unhealthy and also demonstrate the right ways of cooking rice. The company plans to build up a national presence.
The government’s move to lure private sector talent to fill up the numerous vacancies in PSU banks has apparently not met with the desired level of success. Many of the big jobs including finding a CEO for the BRICS bank, debt management office proposed in the budget by the finance minister, Arun Jaitely, are vacant. Besides Punjab National Bank and a few others are also vacant and if reports are to be believed even some of the larger banks’ posts will also be vacant post May. Some of the posts in IREDA are also likely to remain vacant. One of the reasons for the private sector pussy-footing over taking up jobs in PSUs is the fear of reporting to some babus in New Delhi and taking verbal instructions from them. The government, it is learnt, may soon step in aggressively in a bid to resolve some of these concerns as the post of BRICS Bank is too prestigious to leave open for a long period of time.
Kewal Kiran Clothing Ltd (KKCL), with a good collection of affordable and aspirational brands (Killer, Integriti, Lawman and Easies), is going through some challenging times. Although it is in the fastest growing fashion apparel segment, it has suffered due to a lacklustre demand environment for apparels and an onslaught of online retailers offering attractive discounted merchandise. Consequently, though its top line has grown by 9 per cent in the first nine months, its earnings are marginally down by 3 per cent in the same period. According to a source, KKCL is aggressively looking at the online model to boost sales, as the recovery in consumer sentiment sets in. Meanwhile, the company has a strong balance sheet (zero debt with net cash accruals at ?215 crore; constituting 10 per cent of the market cap).
Reliance in Korea
ADAG-promoted Reliance AMC, where Nippon has a stake, is planning to strengthen its ties with Samsung Asset Management. If reports are to be believed a strategic tie-up to cross promote Reliance products in Korea and vice-versa may soon become reality. In which case it may not be long before we see more Korean money flowing into the Indian fund which currently has ^1,37,000 crore assets under management.*