Coimbatore Suguna Poultry Eyes Rs 1400.Cr Turnover by March '07

Suguna Poultry Farm is set to cross the Rs 1,400-crore sales turnover this fiscal even as the integrated poultry producer is spreading its wings into the food chain business with 'Rail road', the desi version of Kentucky Fried Chicken.

"In order to become a leading player in the poultry business, we are venturing into food chain. The first 'Rail Road' restaurant has thrown its door open in Bangalore to cater to the chicken lover. We are planning to enter other states as well, both through the franchisee mode and our own food shoppe," Suguna Poultry Farm managing director B Soundararajan told ET.

The Coimbatore-based company has 12,000 poultry farmers through a contract farming arrangement. It is implementing a Rs 130-crore capital expenditure plan for the current year to strengthen poultry production, feed milling and marketing infrastructure. Recently, the International Finance Corporation has taken a five per cent stake in Suguna, through a $11-million deal.
"Our aim is become a Rs 3,000 crore company by 2010. We hope to notch a 20% share in the broiler market," he said, adding the poultry major could go public in two years' time.
Mr Soundarajan said Suguna is strengthening its portfolio by entering the upstream livestock vaccine besides branching into layer farming. "We have also acquired a 20-acre land in Hyderabad to set up a livestock vaccine unit at an estimated cost of Rs 35 crore as we feel this is a natural progression to our existing business".

Suguna, which has already entered Andhra Pradesh, Puducherry, Karnataka, Gujarat, Maharashtra, West Bengal, Orissa and Punjab, through its unique contract-farming business model, is now looking for a larger footprint across the country.

"The company has grown in size since we started operation in 1984. We are wanting to bring in a professional management to augment our growth plans. Recently, we have put in place a Rs nine-crore ERP solution, supported by Oracle, to link hatcheries, feed-mills, broiler production offices across the country," he said.

On the poultry industry, he said rising maize prices have adversely impacted the production cost at least by 25-30%. "The Rs 9,000 crore domestic chicken market is growing at 13%. Though India's per capita consumption stands at 1.94 kg as against 65 kg of the US, we see lot of growth happening in the domestic broiler market," he added.

Asked whether the it is looking to enter the poultry product space like frozen and chilled chicken, he said although the segment is growing, Suguna, for now, is focusing only on the 'wet' market, the most popular commodity in India.

Suguna's current commercial broiler production is 40 lakh birds a week against the all-India broiler output of three crore birds.

Source:TIMES NEWS NETWORK

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