The Hindu Business Line : Himalya International catches investors' fancy

Growth strategy
Has lined up a Rs 4-cr play for producing whey proteins, lactose powder
To set up a new plant in Himachal Pradesh for whey proteins
Working on debt revamp plan which will improve profitability further

Kolkata , April 7

Himalya International, an export-oriented food processing company, is understood to be on the radar of a group of market makers for its expansion plans and growth.

In the last one week, the stock witnessed gradual price appreciation and rise in traded quantity. However, on Friday the stock closed marginally down at Rs 19.70 against Wednesday's closing price of Rs 20.55. During the last one week, the stock gained 9 per cent. The stock registered a volume of 1.31 lakh shares on Friday against two-week average of 62,000 shares.

New project

Mr Manmohan Malik, Chairman and CEO of the company, confirmed to Business Line that it indeed has taken up another milk related project. This comes immediately after commissioning of mozzarella cheese unit last month. It has chalked up a Rs 4-crore plan for producing whey proteins and lactose powder - derived from liquid cheese residue.

These derivatives are used by the pharmaceutical industry and currently imported . Initial capacity for the two proposed products, to be produced at a unit near the cheese plant at Panota Sahib in Himachal Pradesh, would be a total of 8 tonnes per day (tdp).

Mr Malik indicated that by April 2007, the new plant would be ready for production. "As the raw material would be free, margin could be better than the cheese, which is meant only for the exports," he said. Both whey proteins and lactose power, however, would be marketed in the country as an import substitution.

Himalya International's Rs 51.25-crore US FDA approved cheese unit, having a capacity to produce 30,000 tonnes per annum, has been set up in collaboration with Winona Foods, the largest producer and distributor of cheese in North America.

Deal with Winona Foods

Foreign collaborators, along with Winona Foods, are also picking up close to 19 per cent stake in Himalya. Winona will also market all the produce made at Himalya's cheese unit in the North American market.

Meanwhile, the promoters of Himalya have picked up the stake of 11 per cent held by Himachal state agency, HPSIDC, at an average of Rs 18 per share.

According to market analysts, the business model followed by the company for supply chain and exports could generate higher margins.

A plan for debt restructuring and one-time settlement in cash and shares with IDBI, already under way, is likely to improve profitability further this fiscal, market circles say.

Apart from milk products, company's processed food basket includes mushrooms, vegetables and fruits. Himalya is also proposing to enter into battered and breaded appetiser products for export market, Mr Malik indicated, but declined to give details.

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