Punjab Chemical in consolidation mode

Punjab Chemical and Pharmaceutical Ltd is on a consolidation drive. The company has merged its two subsidiaries""Lalru-based Alpha Drugs India Ltd and Mumbai-based STS Chemicals LTD--to form Punjab Chemical and Crop protection Ltd.

On the back of its new merger and acquisition strategy, the company expects to increase its turnover from Rs 300 crore in the current year to Rs 450 crore next year.

The company has acquired Maharashtra-based IA&IC Private Ltd, an agro formulation company with a turnover of Rs 5 crore. Avtar Singh, Executive Director, Punjab Chemical and Crop protection Ltd said that the loss making unit in Maharashtra would be run in full capacity from this year .

"The unit is currently manufacturing agro formulation sulphur based and we will soon add other agro-formulation. Also, we expect to generate a revenue of about Rs 30 crore in the first year of operation."he said.

With exports accounting to 70 percent of the annual turnover of the company the company has plans to go in for new molecules and expand to new market. "We are working on acquisitions and joint venture in Europe, USA and South America,"said Singh. The company has a sales office in Belgium to cater to the need of the European market.

To cater to the export market the company will invest Rs 10 crore this year to establish a US FDA approved facility in the pharma plant, Alpha Drug India Ltd . Spread over 26 acre land the unit is manufacturing fine chemicals, API and intermediates informed Singh.

The cost differnce of raw material between states , along with varying duties and taxation norms is a challenge which the company is facing.

According to Avtar Singh, the company was growing at a rate of 30% annually and the expansion in the global market was the major growth driver for the company.