India is on path of recovery from a weak economic trend witnessed in the last year. The October’09 to March’10 period seems to shows promise for the industry. The segment of the food industry in which LEAF operates is the fundamental and most essential portion of the sector, which has experienced ups and downs in the last two years due to rice production touching a peak of 99 million MT last year to current year expectation of shortfall by 15% of the normal production of 94 million MT; on the backdrop of drought situation that existed in the country a few months ago.
LEAF had its share of woos during the excess supply situation last year not because of any other reason than the Government of India decision of putting ban on export of non-basmati rice. This is no more relevant presently due to shortfall as mentioned above.
LEAF today has built itself in to a multifaceted company in terms of diversified nature of its product portfolio. The company has 1.2 million MT of new plant capacity and an old capacity of 6.3 million MT which is not in use but can be put in use for FCI grades in case of need. After seeing the adverse situation arising due to excess supply in the last year as explained above, the company entered export of Pusa 1121 variety successfully as also in the domestic branded market creating its market in certain cities of the country.
LEAF’s 30MW husk based power plant also operated successfully during the year. It was started in two phases during. The plant operates at over 90% loan factor and has contributed significantly to the profitability of the company.
LEAF has now fully implemented the ERP solution of SAP implemented by Praneel Innovations Ltd. This will help the company to improve efficiency of its operations and create a formidable MIS system.
The management believes in having Government business as well as export and domestic branded business existing together, coupled with power as add on. This will help the company to de-risk and increase turnover and profits by making use of capital expenditure carried out till now. Going forward, LEAF plans to gradually enhance paddy processing capacity over a period of two years and also increase power generation capacity by 50 to 60MW using multi-fuel boiler technology.
With the support of the company’s various stakeholders LEAF would continue to grow in its space and do its best to show superior performance with each passing day.
This is no more relevant presently due to shortfall as mentioned above.