Stock Research KS Oils

Stock : KS Oils

Acquired an edible oil refinery in Haldia port from Kolkata-based Ambo Agro Products
Deal is valued in the range of Rs 125-150 cr

Factors to watch
Edible oil companies are looking at buying refineries nearer to ports
Nearness to port to reduce transportation costs and take advantage of falling crude oil prices
Sources said that debt to fund 2/3rd of the acquisition and the rest from internal accruals
First refinery in east India for the company
The refinery has a capacity of nearly 500 tonne crushed per day (tcpd)
The acquisition will have a total refining capacity of 1,800 tcpd
Newly acquired unit will sell refined oil in WB, Bihar, Jharkhand, Orissa, North East and UP
Plans to become an integrated edible oil player in SE Asia and a leading FMCG player in India
The acquisition is a part of backward integration
To refine crude palm oil produced at the company’s palm plantations in Indonesia and Malaysia
Major portion of edible oil companies revenues’ are generated in second half of the financial year

About the company:

Largest rapeseed crusher in India
Manufactures products in mustard oil, soybean oil and palm oil categories
Produces brands like Kalash, Double Sher, K S Gold
Enjoys 7% market share in the overall mustard oil segment
Has a 25% market leadership in branded mustard oil
Current installed capacity of 1,475 MT/day
Presence across eastern and central India
Source: UTVi

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