The Hindu Business Line : Amareshwara Agri plans IPO

AMARESHWARA Agri Bio (AAB), a three-decade-old biotech company, is all set to come out with an initial public offering (IPO) to raise up to Rs 25 crore. It has appointed Firstcall India Equity Advisors as the financial advisors to navigate it through the IPO process.

According to AAB Managing Director, Mr K. Prasad, the company intends to use the IPO proceeds to expand into biotechnology applications and set up a biotechnology lab to carry on research and development of genetically modified crops. The company recognised biotechnology as one of the potential growth engines and introduction of Bt gene into the company's products will add value and increase the margins on sales many fold.

Mr Prasad told Business Line that the company had also decided to set up a state-of-the-art seed processing and conditioning plant and air-conditioned storage facilities at Hyderabad and Raichur. The objective of setting up these facilities was to change over from the present seed production into Bt Cotton, Rice, Bt Maize and Soyabean.

Mr Prasad said AAB enjoyed close relationship with more than 15,000 seed farmers and did contract production in over 20,000 acres of land under its various programmes for production of cotton, maize, sorghum, pearl millet, sunflower, hybrid rice, soyabean and vegetable seeds.

The management had also laid down plans to produce and market bio-control agents such as Tricodermavirde, Pseudomonas, Bavariabassiana for effectively controlling pests and diseases of plants and also to produce bio-fertilisers and growth-promoting agents to substitute chemical inputs and achieve higher productivity. The company was planning to improve its operating margins through these products.

AAB, Mr Prasad said, had signed a Memorandum of Understanding with the Centre for DNA Fingerprinting & Diagnostics (CDFD) Hyderabad for DNA fingerprinting of newly developed hybrids. This would help patenting of the hybrids developed by the company.

The company had also entered into an MoU with Indian Agricultural Research Institute (IARI), New Delhi, for promoting its newly developed basmati rice hybrids and varieties. It also has a collaboration with Leckat Corporation SDN BHD of Malaysia for marketing its vegetable seeds in India.

At present, AAB has seed processing facilities at Gadhwal and Kompally in Andhra Pradesh and at Gulburga, Raichur and Chintamini in Karnataka.

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