Dhanuka to invest Rs 50 crore on new plant

Pesticides maker Dhanuka Agritech will invest Rs 50 crore on a new manufacturing plant in Rajasthan and is expecting at least 25 per cent growth in revenue to about Rs 750 crore this fiscal on better monsoon.

It has 3 units in Haryana, Gujarat and Jammu & Kashmir to produce over 80 plant protection chemicals. The Gurgaon-based firm had posted net profit of Rs 64.44 crore and a turnover of Rs 582.3 crore in 2012-13 fiscal.

"We are setting up our fourth plant at Keshwana, Rajasthan with an investment of Rs 50 crore. Construction has started and the first phase is expected to start from December 2014," Dhanuka Agritech managing director M K Dhankua said.

The investment would be funded through internal accruals, he said, adding that the company is debt-free.

Dhanuka has 37 acres in Dahej, Gujarat, for expansion but a decision on that will be taken after 2-3 years.

Asked about sales in this fiscal, Dhanuka said: "Monsoon was good this year. There was good demand for pesticides. We are targeting a minimum 25 per cent growth in sales and at least 30 per cent increase in net profit during this fiscal".

The demand for weedicides have also gone up as chemical weeding has become cheaper because of high labour cost, he added.

Dhanuka is looking for major growth in Andhara Pradesh, Gujarat, Maharashtra, Madhya Pradesh and Karnataka. It has already achieved net profit of Rs 49.40 crore, and revenue of Rs 419.53 crore, in the first half of this fiscal, 2013-14.

The company is engaged in manufacturing plant protection chemicals including herbicides, weedicides, insecticides, plant growth regulators/stimulants in various forms -- liquid, dust, powder and granules. It has 83 products in portfolio that covers almost all crops.

Dhanuka has technical tie up with US and Japanese firms including DuPont and Nissan Chemical Industries.

Its share price fell 0.64 per cent at Rs 187.50 on the BSE today. The company's market cap is around Rs 950 crore.