K.Oil expands capacity through acquisition

KS Oil has also entered into a strategic arrangement with an Alwar based edible oil plant to use their production capacity of Crushing - 100 mt/day, Solvent Extraction – 250 mt/day, Refinery – 100 mt/day and Vanasapti – 50 mt/day for a pre determined fee.

KS Oil is the largest mustard seed crushing company in the country. The company’s current facility at Morena, Madhya Pradesh has an installed crushing capacity of 1,000 tonnes mustard seeds per day and operates at 55% capacity utilization.

With this addition to capacity, the company will have three production facilities –in Morena, Madhya Pradesh, Jodhpur and Alwar, Rajasthan. The overall mustard seed crushing capacity is expected to increase to 1325 metric tonnes per day, refining capacity to 300 MT /day, Solvent extraction at 850 MT/day and Vanaspati production capacity to 200 MT/ day.

The acquisition of Jodhpur Plant and MOU with Alwar plant was formally ratified by the board on June 7th, 2006 as per BSE norms. The total acquisition, modernization and related expenditure will cost the company Rs. 25 crores which will be funded through internal accruals and debt instruments.

Speaking to media – Mr.Sanjay Agarwal, CEO, KS Oils, said, “This move is in line with our strategy to increase capacity through inorganic growth. We are in the process of consolidating our presence in Northern India. Rajasthan, apart from being a key consumer market is also a major producer of mustard seeds in the country and it gives us the synergistic benefits being closer to markets and the consumer.”

The company markets its mustard oil under brands `Double Sher', `Kalash' and ‘KS Gold’ brands. ‘Double Sher’ and ‘Kalash’ brands enjoy leadership positions in northern, central and eastern parts of the country. Double Sher has 50% market share in the North-East.

The Company’s Revenue for the FY 2005-06 touched a record time high of Rs 604.27 crore registering a healthy growth of 34% over Rs 455.11 crore in FY 2004-05. The company's profit after tax grew by a whopping 377 per cent to Rs 16.02 crore, up from Rs 3.36 crore in FY 2004-05.

About K S Oil Limited (www.ksoils.com)
K S Oil Limited is a leading integrated edible oil manufacturing company with a product line in mustard and soybean oils with a turnover of over Rs.600 crores in the year 2005-06. The company is headquartered in Morena in Madhya Pradesh and the promoters have a history of over 100 years in the commodities market. It is listed in the Bombay Stock Exchange (BSE) and is the largest processor of Rapeseed Oil cake in India. Managed by a team of leading professionals with rich industry experience and backed by the promoters - The Garg family with consistent track record of performance-, the company is today amongst the top 5 edible oil companies in India and is poised to become a global player in the years to come.