Insecticides India Limited (IIL) is trying to cross the Rs 800-crore mark this year. In an interaction with SMEntrepreneur, Rajesh Aggarwal, MD, IIL, talks about the growth of agro chemical market in the country.
How you and your father Hari Chand Aggarwal thought of starting IIL?
We have been into agro chemical business for the past three generations. My father joined our family business in late 60s. Later, I and my father moved out of the company HIM Pulverising Mills Ltd in 2001. We handed over the earlier business to my uncle and started IIL.
We registered IIL in 1996 because somehow I wanted to change the name of the previous company, I didn’t find the previous name of the company interesting.
What lessons have you learnt from the previous company?
It was a joint family business. I worked in production, purchases and marketing departments. I learnt everything there and was in contact with everyone. I also got the opportunity to set up a new plant so we shifted to Rajasthan from Delhi during that time. I had a very good exposure in my previous company, which is helping me in this organisation.
What steps have you taken to educate farmers about your products? Were farmers ready to the use of agro chemicals?
Now we have introduced a lot of new generation molecules. To reach to the farmers, we used tractor brand as our symbol as it was much easy to understand.
Our teams directly meet farmers and tell them about the benefits of using our brands and so far the farmers have been convinced by us. Farmer’s education will result in the growth of agro chemical market.
What is the market size of agro chemicals in India?
At present, it is Rs 10,000 crore industry and will increase at a higher rate very soon.
In 2002, India was facing economic recession, how did you survive that period?
IIL started its operation in 2002. It was a period when, India’s agro chemical sector was facing economic recession. As we started as a new company, so we decided to sell other brands that were already in the market. We got a very good response from the market as farmers were already using those products. Thus, we managed to develop good relations with farmers.
Last year, your company was planning to raise Rs 100 crore by selling shares? What about that plan?
We delayed it because the market condition was not good and we wanted to increase our performance. We are trying to show our best performance by doing maximum business this year and we feel that 2014 would be the best time to raise money from market through shares’ sales.
What has been your market share in insecticides business so far?
The brand sales we did last year was around Rs 500 crore, which was around 5 per cent of the total market. This year we would be doing around Rs 650 crore brand sales, which would be more than 6 per cent share in the market.
What are you current footprints and expansion plans?
At present, we are connected to all states and serving farmers with around 120 brands. We would be investing around Rs 25 crore this year in our business. We have established five plants so far – two in Jammu & Kashmir, two in Rajasthan, one in Gujarat– the sixth plant will soon be started in Rajasthan.