Focussing mainly on flower biz: Karuturi Networks

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Focussing mainly on flower biz: Karuturi Networks

KS Ramakrishna, MD at Karuturi Networks says flower business is the largest part of their business. Last year, in a topline of Rs 45 crore, Rs 38 crore came from its horticulture business.

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Q: Any other expansion plans on the anvil for the horticulture business?

A: We are adding an additional 50 hectares in Ethiopia. That would come into production by middle of the next year. We are also putting up a Gherkin processing facility near Bangalore, which can export about 12 containers of bottled Gherkins, which should be coming up into production by end of November.

We are in the process of acquiring instant quick frozen food company from one of the banks. We are also looking at an acquisition in Kenya, which could be a very large acquisition.

Q: The total acquisition cost of both these companies would amount to?

A: The additional expansion in Ethiopia would consume about USD 8 million. Flower business is the largest part of our business; the acquisition of the Gherkin unit in India is taking about USD 1.5 million.

Q: What about the funding of these acquisitions and expansion?

A: As of now it's mostly on internal accruals, for the Gherkin units. We have taken on debt of about Rs 7 crore from bank mostly for working capital requirements. For capex, we have taken a loan of about Rs 3.5 crore. For the Kenyan acquisition, which is a real big number, we are looking at raising some debt on the target assets.

Q: What will be the total debt in your books?

A: At this point of time our debt is under Rs 5 crore.

Q: What is the value of this land that you used for horticulture? How much do you have and what is the value of it?

A: We have substantial chunk of land. We have about 250 hectares in all. Ethiopian facility has a very large chunk of land.