Suguna Poultry Farm in India will receive about US$30 million (Rupees 139 crore) as a one time payment from the International Finance Corporation (IFC) for capital expenditure and as working capital to support its expansion plans for this year.
The payment will be on debt-cum-equity basis, though the equity component has not been decided, said Mr B Soundararajan, managing director of Suguna.
This is part of the company’s planned investment of US$194 million (Rupees 900 crore) over the next four years to expand production and modernise its existing facilities.
The Coimbatore-based company plans to increase capacity of its breeders, hatcheries and feed-mills. “Our broiler capacity will increase to 10 million birds a week from the present 4.5 million birds a week,” said Mr Soundararajan.
The company has set up hatcheries in Chittoor and Hyderabad in Andhra Pradesh and Nashik in Maharashtra. New hatcheries will also be set up in Karnataka, Tamil Nadu and West Bengal. The company also depends on small poultry farms for its processing units. “We will reduce this dependence over a period of time by setting up our own hatcheries,” he said.
Suguna will invest in new feed-mill projects in Maharshatra, Karnataka and Andhra Pradesh.
Most of the expansion will cater to the domestic market. “From an import point of view, Indian poultry is not as competitively priced as Brazil’s poultry. Inputs to poultry farms such as maize and soya are costlier here when compared to Brazil,” he said.
Suguna recently got approval from the government of Japan to export value-added processed chicken from India to Japan. But post bird flu the company has not received orders from Japan, said Mr Soundararajan.