Jiya Eco-products Plans For Major Expansion Of Pellet Plant In Gujarat
2018-04-06 Announcements Metallurgical Industries Western India
Jiya Eco-Products Limited (JEPL) had announced that the company has signed a 15-year agreement to lease out a land parcel of approx. 3 acres at Gandhidham, Gujarat. The land parcel, so finalised, is proposed to house JEPL’s new pellet manufacturing facility. The proposed plant, located at Village- Chudva, Taluka Gandhidham, is spread over “‘3 acres. The location finds a strategic fit in the major expansion that JEPL has scheduled over the next 2 years. Abundant access to raw material and a reduction in transit cost are key parameters that aided in finalisation of this location. Kutch (Gujarat) is in close proximity to the proposed plant of JEPL and is also home to the, highly aggressive weed, Juli Flora. By using Juli Flora as one of the key ingredients in the manufacturing of pellets, JEPL also helps the local administration tackle the menace of the fast-spreading forest weed. The demand for pellets, from JEPL’s existing customers in east Gujarat, would be met from the proposed Gandhidham plant thereby helping in bringing the transit costs lower.
JEPL proposes to set up a pellet manufacturing plant at Gandhidham, with a rated capacity of N 1,80,000 MTPA. Once operational (by end QZFY19), this would more than double their existing capacity (”82,000 MTPA). Pellets, manufactured at this location, are proposed to be catered only to the retail market (Namkeen, Bakeries, Fursaan etc) and would benefit the company in multiple ways:- Sale to retail clients would help stoke realisations significantly, lower transit costs, help widen the client base thereby de-risking its current business model and help improve the working capital profile of the company. JEPL currently has a step-down " ' subsidiary, Jiya Eco-Products India Limited (JElL), which is engaged in the business of acquiring retail clientele by installation of burners at retail client sites in exchange for a 3-year contract that retail client would sign with JElL to procure their monthly pellet requirements from JEPL at a pre-determined price. JEIL targets installation of 1000 such burners at its retail sites over the next 18—24 months. This would ensure captive consumption of the pellets proposed to be manufactured from the Gandhidham plant.