Mumbai: Jain Irrigation Systems Ltd is focusing on exports of fruit purées and concentrates in an attempt to tap into a growing preference among consumers in the developed world for natural beverages, and leveraging expertise it has built up in acquiring and processing mangoes.
The company recently won a Rs84 crore order from The Coca-Cola Company to supply mango pulp for use in fruit-based beverages.
Jain Irrigation, one of India’s largest private sector processor of fruit and vegetables, has started manufacturing banana purée, pomegranate juice concentrate, and papaya and guava concentrates for supply to companies in the US and other countries under its FarmFresh label.
Anil Jain, the company’s managing director, says Jain Irrigation is strengthening its relationship with farmers and that it was the single largest buyer of mangoes in India in the recent mango season. “Now that we have purchased 75,000 tonnes of mangoes from farmers, we will be able to create additional revenue streams by getting into supply of dried mangoes, etc., used for making healthy fruit-based snacks in the US and Europe,” he adds.
Jain Irrigation’s supply chain depends on a network of Jain gram sewaks or village workers who service a cluster of villages to ensure that fruits of the quality and in the quantity desired by the company are produced by farmers.
The company, which is also India’s largest manufacturer of drip irrigation systems, is engaged in contract farming of vegetables—it supplies seeds and other agri inputs to farmers and buys back vegetables from them. “Demand for banana pulp is being fuelled by demand for baby food. Pomegranate juice demand is growing rapidly as a result of its high antioxidant properties, which recent research has shown to be beneficial in preventing prostrate cancer among others,” says Jain.
Jain Irrigation’s move to process other fruits into pulps and concentrates will also help the company use its fruit processing facilities for 10-11 months every year, as opposed to the 85-day mango season it currently uses them for. “Using our scale, we will enter into processing of new varieties of vegetables such as tomatoes and capsicum, supply of fresh mangoes to retail consumers, and grow the share of this division to our total revenues from 13-14% of the total to 20%, in addition to boosting its profitability,” says Jain. The company ended 2006-07 with net sales of Rs1,208 crore and a net profit of Rs90.96 crore.