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Kolkata-based ₹1,300-crore Krishi Rasayan group expects rapid growth in its pesticide business in the next five years, riding on off-patented molecules and higher value additions to existing offerings.
The ₹16,000-crore Indian pesticide market is primarily driven by off-patented products. With patents running into billions expected to expire by the end of this year itself, Indian players such as Krishi Rasayan have the opportunity to significantly expand their product portfolios through new launches.
“We expect to double our turnover to at least ₹2,500 crore in the next three to five years,” Atul Churiwal, Chairman & Managing Director, Krishi Rasayan, told BusinessLine .
The group is also looking at tie-ups with foreign companies for coming up with organic bio-stimulants to improve crop yields. Krishi Rasayan has three companies under its fold that include Krishi Rasayan Exports Pvt Ltd and Krishi Rasayan – for mid-market and premium products; and, Agro Life Science Corp, which is into the budget and mass segment.
Patent expiry
Around ₹75 crore will be spent in enhancing existing product lines across eight plants – one each in Bengal, Bihar, Odisha and Himachal Pradesh; and two each in Gujarat and Jammu.
According to Churiwal, the company expects to grow at par with the market with the launch of new compositions (offerings) after the expiry of patents on various molecules.
The group’s ₹20-crore research facility at Kalyani, 60 km from Kolkata, will be leveraged to come up with these new offerings. With the expiry of patents, high-end molecules generally restricted to the premium-end will become affordable.
“In the next five years, patents on several molecules will expire. And since, we are an off-patent company; we have to see how fast we can introduce those components here in India,” he pointed out.
“As patents expire, there are chances of these products becoming mass offerings because of a price crash. We have seen this earlier with three or four other offerings. As prices come down, demand increases and volumes go up,” Churiwal added.
Bio-stimulants According to Churiwal, Krishi Rasayan has tied up with Canada-based Acadian Plant Health to launch organic bio-stimulants that lead to 15-20 per cent improvement in crop yields.
Although the offerings may just add ₹50-60 crore to the company’s turnover in the next three years, they offer are high margins. “The first target is going to be tea, but we can use it for other crops as well,” he said.
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