MMTC will sell 10% stake: Ved Prakash

Interview with Chairman & MD, MMTC Limited

MMTC Limited is firming up plans to foray into new verticals and consolidate the existing market. Its chairman and managing director, Ved Prakash, talks to Komal Amit Gera on the plans. Edited excerpts:

MMTC has a stake in defunct commodity exchange ICEX. What are the plans for its revival?

The operations of ICEX were suspended last year, as the exchange was not doing well. Now, the shareholders want to revive it. The board of directors at MMTC and the exchange have also approved the revival. It might take six months to resume operations.

Will MMTC remain a shareholder?

We will offload 10 per cent of our stake and retain 16 per cent. We have identified buyers for the purchase of stake diluted by MMTC and will announce it in a few days.

Commodity prices across the world have dived due to excess supply and low demand. Is it the right time to revive a commodity exchange?

India has only two major commodity exchanges and they do not cover all commodities. There is room for more players. Another exchange can fill the gap. We have addressed the issues in past performance and will re-launch with new strategies.

Are you hoping to import more pulses?

We have imported 5,000 tonnes so far this year. We are working with the ministry of food and consumer affairs to import more of tur  and urad dal . We have also decided to export iron ore to Japanese and Korean steel mills under an agreement for 1.5 million tonnes per annum for three years.

Exports are dwindling. Does MMTC have a plan to seize opportunities in new verticals?

We’ve carved out two divisions to facilitate exports. Pharmaceutical exports for the government-to-government-segment and exports of engineering goods for the African continent are the two new areas we plan to foray into. We might sign lease agreements with pharma players to buy quality products for export. These will help small and medium enterprises to boost their business.

Do you plan to boost your presence abroad?

We are present in Singapore and Johannesburg and might open an office in Dubai, given its location advantage of being a trading hub. Simultaneously, we might increase our penetration in the domestic market by expanding our network in Kanpur (Uttar Pradesh) Kakinada (Andhra Pradesh) and Raipur (Chhattisgarh) to meet the demand for non-ferrous metals and edible oil.

The Government of India has launched gold schemes. What role will MMTC be playing here?

We have earmarked Rs 15 crore to modernise the production facility at our own mint in New Delhi to mint the ‘Indian Gold Coin’. Within six months, we may be able to mint about 30,000 coins in a month. We will source gold from Tirupati Temple Trust for making gold coins. State Bank of India and Indian Overseas Bank provided us 2.3 tonne of gold earlier for making gold coins.

Currently coins are being minted by the Security Printing and Minting Corporation of India Limited. Projecting a higher demand, our mint will supplement the production of gold coins.

In next two weeks the gold coins will be available at the select branches of ICICI Bank and State Bank of India. We are also forming tie-ups with foreign banks and retail chains to distribute the gold coins for Indian diaspora living in US, UK and Canada.