Ruchi Soya diversifies into tomato processing
May 17 2013, 16:16 | By Entrepreneur
By Ashna Ambre
Ruchi Soya Industries is diversifying into the tomato processing market in collaboration with Japan-based firms Kagome, a tomato products company, and Mitsui & Co., a trading and investing firm, the soya products and cooking oil maker said in Mumbai on April 29.
"Ruchi Soya will have a 40 percent stake in the joint venture while Kagome and Mitsui will jointly hold a 60 percent stake through the creation of a special purpose company," said Dinesh Shahra, Founder and Managing Director, Ruchi Soya Industries.
According to a statement, Kagome and Mitsui will own 66.7 percent and 33.3 percent share each in the special purpose company.
The joint venture (JV), Ruchi Kagome, will launch premium tomato puree, sauces, ketchup and other products in India, the statement said. The company revealed that it will set up a manufacturing plant in Maharashtra with an investment of Rs. 44 crore. The plant is expected to be ready for commercial production by June 2014.
"India is a developing economy, the high rates of growth in urbanization coupled with high purchasing power and growing food industry makes it an ideal investment option for us," said Hidenori Nishi, President at Kagome.
According to Nishi, the joint venture is looking at revenue targets of Rs. 340 crore and operating profits worth 18 percent over the next five years.
The joint venture will use the technology and research from Kagome to operate in India and service the B2B and B2C segments. Our company will assist in accelerating growth of the joint venture and maintain internal functioning control," said Yasuhara Fujiyoshi, COO, Food Products and Services, Mitsui.
India is currently the second largest producer of tomatoes in the world and produces 17 million tons of tomatoes every year, the statement said.
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