Meghmani to produce herbicides

Meghmani Organics Ltd (MOL) will invest Rs 84 crore at its facility at Dahej, in Bharuch district of Gujarat, to manufacture environment-friendly herbicides for the global market.

The project will be funded by a term loan of Rs 56 crore while Rs 28 crore will come from internal accruals, a company spokesperson said here.

The first phase of its operation is expected to begin by December while the company is likely to achieve capacity utilisation by April 2010. MOL expects to achieve a top line of about Rs 130 crore by FY2011.

MOL, listed in Singapore, BSE and NSE, is using its global marketing network for agrochemicals and is focusing on exporting technical grade pesticides as well as various formulations to its customers.

It has identified two environment-friendly herbicides as its new product launch. Their annual installed capacity will be 9,600 tonnes and 12,000 tonnes respectively. In addition, 2,400 tonnes of a byproduct will also be generated. The market size of these herbicides is around 73,000 TPA and their worldwide major suppliers are Nufarm (Australia), Dow (the US), Atanor (Argentina) and Atul Products (India).

Established in 1986, Meghmani, manufacturer of pigments and agrochemicals, specialises in green and blue pigment products that span multiple applications such as printing inks, plastics, paints, textiles, leather and rubber.

For the financial year ended March 31, 2009, Meghmani’s export sales accounted for about 76 per cent of the company’s revenue. Asia (excluding India) contributed about 18 per cent to the exports revenue.

The domestic market in India accounted for 24 per cent while North America and Europe contributed 32 per cent and 27 per cent respectively. The remaining contributions came from markets in South America 15 per cent, Australia 5 per cent and Africa 3 per cent, the company added.