The Company incorporated on 6th January 1986 and was promoted by General Goods Pvt. Ltd. and Ruchi Pvt. Ltd, of the Shahra Group of Industries. It is an agribusiness company and manufactures Soya proteins, Specialty Soya products, Soya snack foods and Nutrela. New texturised soya protein plants are near Noida, U.P. and near Indore, M.P. The company also exports soya products. Ruchi Soya Industries Limited is a flagship company of the Ruchi Group of Industries with an annual turnover of Rs 3868 Crores and is one of the largest agri business companies in India.

Company enjoys massive distribution network, built over the years, is a major strength for it. Catering nationally through 2.25 Lac retail stores, with 38 Company depots, 36 Super Stockists and a sales staff of 201, Ruchi has attempted to penetrate depth wise, along with opening new markets. With its importance on providing value goods to consumers, Ruchi’s dual strategy of popular and premium range works well. The value-for-money positioning helps generate large sales volumes for the products.

Products & Services—

Company is having wide range of food products include healthy cooking oils, nutritional Soya foods, High-grade vanaspati and bakery fats. It is the market leader in the edible oils, as well as Soya foods categories. The edible oil range includes many top brands like Soyumm, Soyabean oil, Ruchi Gold Palmolien oil and Sunrich sunflower oil. Nutrela is the largest selling Soya foods brand in the country, with over 50% market share. Nutrela and Ruchi No. 1 vanaspati are regional leaders in their respective categories.

Products category:

Soya foods: Nutrela flavor, Nutrela Proflo soya flavor, Nutrela TVP Chunks & granules.

Edible oils: Nutrela vitamin oil, Nutrela filtered groundnut oil, refined soyabean oil, refined sunflower oil, mustard oil, refined palm oil, rice bran oil.

Vanaspati: Nutrela vanaspati, Ruchi no.1 vanaspati.

Bakery fats: bakery fats, speciality bakery fats.

Ruchi is a leading manufacturer of high quality edible oils, vanaspati, bakery fats and soya foods, Ruchi Soya is also the highest exporter of soya meal and lecithin from India. Nutrela is the largest selling soya brand in the country today. Company has one of the largest crushers of Soya beans in India, and has installed a crushing capacity of 2500 mts. per day in Indore, which is the largest crushing capacity at a single location. If we see on yearly basis, Ruchi crushes around 25% of the soy crop in India. This has lead to the export of 30% of India's Soya bran meal on a yearly basis. Soya meal is the crushed seed after the oil has been extracted. It has a big export market, and is used to feed cattle/chicken. It also accounts to the export of value added products like the edible defatted soy flour, full fatted edible flour, Soya lecithin, Soya granules and Soya chunks. All the products are made from non-GMO beans. Company exports its products to countries include Indonesia, Vietnam, South Korea, Thailand, Philippines, Japan, Taiwan and all the Gulf countries, apart from those in the Indian subcontinent.

Company has grown to become a multi-million US Dollar company. Two of its strongest brands, Nutrela and Ruchi Gold are leaders in their respective category. Nutrela, the biggest Soya foods brand in the country, enjoys more than 40% of the market share. It has enjoyed the trust of consumers for last 20 years now, and continues to expand its range to cater to varying needs of its consumers. It has become generic to the soy category.

The edible oils brands like Ruchi Gold and Soyumm enjoy mass acceptability and acclaim from the people. Ruchi Gold is the leader in the palmolien category. As a part of packaged goods thrust, ‘Ruchi Gold' was introduced about 6 years back in Chennai, and is available in small villages as well. The market share in southern states ranges from 50 to 85%. The brand has grown from35% to 40% CAGR since its introduction. Company has number one position in branded palmolein oil category, which is more popular in south. Soyumm ranks in the top 3 soy oils category.

Ruchi is the leader in vanaspati category, and has also ventured into bakery fats range. Ruchi group was amongst the first to set up a refining plant with a capacity of 1000 tonnea / day, state of the art technology and a world class size. Company’s cost of production is comparable to the lowest in the world today. The group has nine refineries in place today, with total capacity of approx 7500 tonnes a day including Haldia, Chennai, Kakinada, Mangalore and Indore. The newest one at Patalganga is now comissioned and is a port based refinery. This national and port based setup gives Ruchi logistical advantages and helps reduce costs. 'Ruchi group also has the largest soya crushing/solvent extraction capacities in the country, with a capacity of 7000 Mts/day.

Recent developments—

Ruchi Soya Industries (RSIL) entered into an exclusive technology licensed agreement with Kansas, USA-based NutriJoy for its patented functional beverages & snack foods technology. Besides India, the license will cover China, Australia most SAARC and ASEAN countries, as a part of the agreement, NutriJoy will provide technical assistance in the commercialization of these products. The agreement with NutriJoy fits perfectly with our objective of reinforcing our position in the 'health and wellness' segment. The agreement will provide us with world class nutrition technology and a pipeline of commercialized, patented market tested products to further build added value to RSIL’s core brands in India and other products worldwide, said Sarvesh Shahra, Head – Foods Division, RSIL. Ruchi Soya Industries Limited is a fully integrated Soya processor.

Ruchi Soya Industries (RSIL) is planning to expand its flagship brand Nutrela to functional foods and beverages and has signed an exclusive technology licensing agreement with NutriJoy, a US-based firm. NutriJoy is in the business of commercialization of patented research technology for functional foods and beverages. Ruchi Soya is planning to launch new product range of food enriched with vital nutritional additives and cooking oils in the premium segment. It would expand its range through brand extension and distribute them through its 2,000 distributors and 400,000 outlets in the country. The processed foods sector is estimated at Rs 2,500 billion. However, most of this market is unorganized. A major part of company’s Rs 80 billion turnover is contributed by Nutrela products.

Ruchi Soya Industries with their flagship brand Nutrela on Mar. 11, 2008 expanded their product portfolio by launching “N-rich” in the beverage segment. N-rich is a tasty protein drink available in 3 distinct flavours, rich in vitamins, minerals and antioxidants, which makes it a healthy beverage. The flavours are a rich combination of exotic fruits like, Apple Kiwi, Apple Peach and Multifruit. N-rich is a packaged, 100% preservative-free fruit Juice brand offering consumers the great taste and wholesome nutrition of fruit Juices in a hygienic and attractive pack.

Valuation—

At current market price, stock is trading at 4.87 P/E multiple of its FY2010 estimated earnings. We recommend investors to BUY “Ruchi Soya” with Medium to long-term investment prospective.