How is your 2017 shaping up, and what are your company’s plans for the future?
Our Q1 has shown an increase of 21.1% to $26.8 million, and we see 2017 as a good year for our business. We plan to ramp up production capacity to increase volumes and margins. We are going to add more capacities with backward integration.
Meghmani also will focus on developing the North and South American markets further, in particular the Brazilian market, and we expect to have a good outcome by 2020 in terms of registrations and product launch.
In addition to working on new chemistries expected to go off-patent in the next two years, we are establishing our own GLP lab, which should have accreditation by end of this year. This will certainly help in expanding our portfolio and markets.
What is your outlook for crop protection exports, given the major changes taking place in the industry?
With regard to the change in environmental policies particularly both in India and China, Indian exports are expected to gain more foothold in the international market. Indian industry is expected to grow at much faster pace as strict environmental regulations are already in place in India and the industry is already fully equipped.
More markets are opening up for generics products and government policies are more inclined towards manufacturing base
How will environmental restrictions in China and consolidation change the way Indian companies do business?
Environmental restrictions in China with many factories shutting down gives opportunities to Indian business. Many existing manufactures and SMEs will have a chance to expand or start new businesses. India has many advantages in terms of low cost of production and a skilled work force. Having said that, we also have to find ways to counter the challenges in terms of environment. Cost is certainly going to face pressure on products from China. Prices will go up in long run and availability could also be affected for some time.
Consolidation of the industry will also have positive impact on market especially for generic companies. It will give them ample opportunities to add more products into its portfolio.
How has India’s domestic crop protection market changed in recent years?
In addition, currently many companies are focusing directly at the farmer level by engaging in various programs. They are educating, and there is a technology transfer to farmers in terms of evaluating soil quality test, predicting weather conditions and many other factors directly affecting enhancement and yield of crops.
Meghmani has a very robust domestic team, and is conducting business through a network of more than 3,000 distributors. We are also engaged in technology transfer to farmer’s level in key states including Karnataka, Punjab. Andhra Pradesh, Maharashtra, Madhya Pradesh, Rajasthan, and Gujarat. Farmer’s education is an integral part of Meghmani culture. We are focusing on developing our brand business by adding new products and regions.
How do you see Make in India impacting your business? And what about the Indian industry as a whole, particularly if new registrations for imports of products which can be manufactured in India are no longer permitted?
The Make in India policy is encouraging for Indian manufactures particularly with low cost of production, availability of skilled workforce couple with strong domestic demand. There had been sweeping changes in registration guidelines for curbing imports of technical that are registered by Indian companies for indigenous manufacturing.
This will also help Indian companies to focus more on new chemistries coming off patent and contract manufacturing for global companies.
Can you talk about some of the biggest challenges right now and how you are addressing them?
There are many challenges faced in the domestic and international market, the foremost being the change in climatic condition worldwide. There had been good monsoon this year in India but various parts of the country had also seen floods, thereby affecting many crops. It is need of hour to focus on this issue of change in climatic pattern at various platforms and address it by way of focusing more on Internal markets. This can only be addressed if we have footprints in different markets which can help us to avoid problems in one particular area.
Another challenge is the stiff price competition from China. We are making all efforts to be in market with different strategies to combat price competition from China by way of increased production and backward integration.
Regulatory challenges are another obstacle. Entry barriers are very stringent in the case of pesticide products in any country. With our GLP lab coming in we are hopeful of addressing this in a very effective way in the near future.