KS Oils may refine edible oil at Haldia

Kolkata: KS Oils Limited, one of the leading manufacturers of mustard oil in India, has announced that it would set up an edible oil refining plant near Haldia in two years.

'The plant would spread over 25 acres, near the Haldia port, entailing an investment of Rs 100 crore. The plant's capacity is targeted at 500 ton per day and it is expected to operationalise in the next two years', Ramesh Garg, chairman of KS Oils Limited told reporters on the occasion of launch of the company's products in the city.

The objective of setting up the refining plant near the port is to cut down logistics costs significantly.

KS Oils is also looking to set up a full-fledged manufacturing plant near Haldia for production of mustard oil as well as soyabean oil.

'Setting up a manufacturing base near Haldia will give us a convenient access to the North-East, which currently accounts for about 40 per cent of our total sales. We can improve our profit margins by reducing the transportation costs. This apart, we can also cater to the market in Bangladesh through our plant near Haldia', he added.

The company, which currently has three manufacturing plants- one at Morena(Madhya Pradesh) and the other two in Rajasthan(Alwar and Jodhpur) has unveiled a plan to establish 5 more greenfield units.

Three of these units would be set up at Guna, Ratlam and Morena in Madhya Pradesh.

The remaining two plants would come up in Rajasthan, one at Kota and the second location is yet to be finalised.

The total investment for all the five greenfield plants would be Rs 400 crore.

The new plants would manufacture mustard oil, soyabean oil and vanaspati.

The overall production capacity of KS Oils, which currently stands at 2,625 ton per day is set to scale upto 4,500-5,000 ton per day after the five new greenfield plants are operationalised.

KS Oils has also lined up an investment of Rs 150 crore for palm plantation in Indonesia and Malaysia, with the objective of producing palm oil.

'We are hopeful of resuming production of palm oil in the next 4 years. Our company will also invest Rs 200 crore in wind power generation from wind turbines, each with a capacity of 30 MW', Garg said.

KS Oils has a sales target of Rs 1,088 crore in 2007-08, up from Rs 608 crore in 2006-07.

It has also planned to raise its revenue from Rs 1100 crore in 2006-07 to Rs 1800 crore in 2007-08 and net profit of Rs 100 crore for the upcoming fiscal.

As of now, KS Oils has 350 distributors and 3000 retailers throughout India.

The company, which commands a strong position in the edible oils, is known for brands like 'Double Sher' and 'Kalash', both in the mustard oil segment.

The other popular brands are KS Refined Oil, 'Crystal Clear' (soya vegetable refined oil), 'KS Gold' (vanaspati ghee) and KS Gold Plus (vanaspati ghee) in the North-East and eastern regions.

The company has a market share of 3 per cent in the total edible oil market and hopes to raise its share to around 15 per cent by 2010.