Growing flowers and other agri commodities in East African nation of Ethiopia appears to be catching up with more and more Indian entrepreneurs. After Karuruti Global made headlines for getting control over hectares of land in the country for its agri business, there are others who are slowly building their presence like Neha International Ltd.
The Hyderabad-based firm promoted by G Vinod Reddy has struck a deal to acquire 49.99% stake it didn’t own in Oromia Wonders PLC, a floriculture unit located in Ethiopia, for an undisclosed amount. With this acquisition, Neha International through its wholly owned arm Globeagro Holdings (acquired in February 2008 that made it one of the largest exporter of roses from Ethiopia to Japan) will own 99.99% in Oromia Wonders PLC.
The company that started business in mid-90s, entered Ethiopia around five years ago. It has sold off farm in Pune and shifted key operations to the African nation where it has two set of land for floriculture as well as foodgrains.
It has expanded beyond being a supplier of flowers to Europe besides Middle Eastern markets in Saudi Arabia, Qatar and UAE. It is now aiming to generate value with cultivation of rice and pulses besides wheat and oil seeds.
It started operations in a phased manner on 4,000 hectares on lease in Ethiopia and in June this year disclosed it has acquired 10,000 acres in Ethiopia through its wholly owned subsidiary as part of diversification into agriculture.
For the 12 months ended June’10, the firm had consolidated revenue of Rs 55 crore with net profit of Rs 13 crore. Growing profitability is also reflected in its stock performance with the scrip zooming almost 11 times over the last one year. At latest traded price of Rs 239 per share, the company has a market cap of around Rs 333 crore.
Companies like Neha International and Karuturi are banking on conducive climate for agriculture in Ethiopia that also offers incentives for investors besides providing a base to target markets in Middle East ad Europe.