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| Nagarjuna Fertilisers plans African foray |
| B Krishna Mohan / Hyderabad Jul 18, 2010, 00:58 IST |
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Nagarjuna Fertilisers and Chemicals, the flagship company of the Nagarjuna Group, plans to set up an urea manufacturing plant in Nigeria. This would be Nagarjuna Fertilisers’ first foray into Africa.
Though the plan is in a nascent stage, the company plans to invest about Rs 5,000 crore. For this, it would set up a joint venture (JV) with a local partner. The plant would have a one million tonne capacity.
The African countries want India investors to invest in agriculture and allied fields. Gas, critical for urea production, is available aplenty. “There would be scope to sell the produce domestically or import to India,” said K S Raju, chairman of Nagarjuna Group.
“We are working out the modalities for the African foray. This would take some time,” he added.
The group is also planning to expand its feeds and fuelstocks segment. As part of this, it is planning a JV in Germany for manufacturing chemicals for solar energy and semiconductor applications. The company will spend about Rs 150 crore for this. “We expect to complete the formalities by December,” he said.
For this, the company would invest in Nagarjuna Mauritius, a wholly-owned subsidiary. Then, the amount would be re-invested in Nagarjuna Spawnt GmbH in Germany. “There is a growing market for these chemicals in solar applications,” he said.
Following the announcement of a nutrient-based subsidy (NBS) mechanism for non-urea fertilisers, the group is setting up a 100,000-tonne customised fertiliser unit in Kakinada. This would entail an investment of Rs 20 crore to Rs 40 crore.
The facility would be ready in a year. The company would sell the products in Andhra Pradesh first, Raju said.
The Indian government is yet to bring urea under the NBS regime. However, announcements were made to this effect in the 2009-10 Budget. The present pricing policy for urea expired on March 31 and a new policy is being formulated. It was expected that the new policy would be favourable to urea manufacturers, he said.
It recently signed a memorandum of understanding with NMDC for collaborative projects. NMDC would use its mining expertise and Nagarjuna its experience in fertilisers for the joint projects, he said.
In 2009-10, Nagarjuna Fertilisers achieved the highest ever sale of manufactured urea of 1.5 million tonne, surpassing the previous best of 1.39 million tonne last year. The total urea sales, manufactured and imported, were at 2.11 million tonne during the year, compared to 2.3 million tonne during 2008-09.
While net sales were 1,987.91 crore (Rs 2,371.9 crore), profit after tax stood at Rs 66.37 crore (Rs 27.93 crore last year).
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