Coromandel International, a Murugappa group company, has entered into a joint venture with Yanmar & Co and Mitsui Trading for manufacturing and marketing farm machinery.

Coromandel and Yanmar will hold 40 per cent stake each and Mitsui 20 per cent. Details of the investment will be finalised later this month. It will initially manufacture the Yanmar brand of mini-harvesters, planters and rotavators for paddy cultivation and then expand its range to include equipment for other crops, including sugarcane and vegetables, according to A Vellayan, Murugappa Group’s Executive Chairman.

The machinery will target small farmers, a segment in which Japanese manufacturer Yanmar has a strong presence. The equipment will be sold and leased to farmers through Coromandel International’s Gromor chain of rural market outlets.

This is one of the group’s key focus areas for the current year – farm mechanisation and the nutraceuticals business. The Murugappa Group’s businesses span fertilisers, sugar, manufacturing and financial services, which together account for annual sales of nearly ₹25,000 crore.

The nutraceuticals business based on Spirulina, an alga, and Astaxanthin, an antioxidant, will grow multi-fold this year, Vellayan said.

Fertiliser manufacturer Coromandel International, with sales of about ₹10,000 crore, has secured raw materials from its overseas joint venture in Tunisia – TIFERT, which has started shipping phosphoric acid to India.

EID-Parry’s sugar business will also get a fillip with the SEZ refinery in Kakinada, Andhra Pradesh, starting operations this month.

Tube Investments of India’s ₹400-crore project to manufacture large-diameter tubes catering to hydraulic, oil and gas and automobile industries will commence production next month. The company has major expansion plans in tubes, chains and cycles, he said.

Vellayan said the Group sees emerging clarity in policy, sustained increase in liquidity and overall improvement in consumer sentiment driving growth. Its long-term plans will be finalised in a couple of months, once the policies and programmes of the new Government at the Centre are announced.

In 2013-14, due to slow market conditions, the group’s capital expenditure hit a low of about ₹166 crore compared with nearly 10 times that amount the previous year.

The group recorded an 8 per cent growth in turnover over the previous year but the profit before tax was more or less flat at about ₹1,415 crore for the year.

Related Topics
comment COMMENT NOW