Kilpest India signs MoU for JV with Spain's Biotools

237 Investors following Kilpest (I). Share this News with them.

0

Like this story, share it with millions of investors on M3

Kilpest India signs MoU for JV with Spain's Biotools

Kilpest India may be a small firm with a market-cap of Rs 8 crore, but the company has seen strong gains after signing a memorandum of understanding (MoU) with Spanish biotechnology company Biotools B&M to set up a joint venture in India.

Post your opinion here

 

0

Tweet

Share on Tumblr

ALSO READ See latest News about Kilpest (I) See previous management interviews See what other Experts & Brokerages are saying about Kilpest (I)

Kilpest India may be a small firm with a market-cap of Rs 8 crore, but the company has seen strong gains after signing a memorandum of understanding (MoU) with Spanish biotechnology company Biotools B&M to set up a joint venture in India. In the JV, Kilpest India will hold 51% stake, while the remaining 49% will be held by Biotools said the director of Kilpest India, DK Dubey.

Below is a verbatim transcript of DK Dubey's interview with CNBC-TV18's Reema Tendulkar and Ekta Batra. Also watch the accompanying video.

Q: Can you tell us about the JV plans with Biotools B&M Labs and when would that culminate in India?

A: The company is from Spain. It's a leading biotechnology company in Europe and we will start production in February 2011. This industry is basically Biotech oriented and we will be doing molecular biology reagents which are being used in the life care, pharma industry and all biotech research institutes and universities.

We will also be manufacturing diagnostic kits which will be used in the diagnostic industry, in the healthcare industry and we will be making Agfood kits also which will be used for the genetically modified organisms (GMO) crop certification for exports.

Q: It's been a 40% rise in your stock price ever since this MoU was announced. How important is this for your own company in terms of revenues, margins or even profitability?

A: Let me speak about the industry. The molecular diagnostic industry or the reagent industry is around Rs 100 crore and its growing at 25% compound annual growth rate (CAGR) and basically it's an import industry where resellers are importing the reagents and selling it to the Indian biotech industry. There is only one major player that is Bangalore Genei. Last year it was taken over my Merck .

Once we put up the production facility here we will be very cost competitive vis-à-vis the manpower cost of India versus European and the air freight involved and the cost of the customs duty. Once we are cost competitive and the technology of Biotools is well established, we will have a major share of the market.

Q: Financially if you had to pin you down to some numbers, from this JV what is it that you expect financially?

A: It's very difficult to give any projections as of date. The numbers would be very good as far as the topline and the bottomline is concerned. In 2011 and 2012 we should end very well. It is too premature to give those specific numbers.

Q: What are the terms of the JV? Is it a 50 - 50 JV and also what is the total investment?

A: For Kilpest it is 51% and for Biotools it is 49% and the total outlay for the JV including the technology fees is Rs 10 crore.