Camson Biotechnologies Limited
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Transcript of Camson Biotechnologies Limited
Camson Biotechnologies Limited
A leader in Agricultural Innovation
Overview
Source: 3
Activity
India's first integrated agricultural biotech company
First mover advantage – Biocides
All set to leverage the hard work put in over the last one and half decades
Competitive Advantages Growth over the Years
CAGR of over 80% (FY 06–10)
Consistent EBITDA Margins of 19% + in last 5 years
Consistent PAT Margins of 16% + in last 5 years
Financials
EBITDA
Revenue
PAT
Business verticals:
− Seeds
− Biocides & Bio fertilizers
(Amt Rs. in cr)
Overview
Vision & Mission
Source: 4
Vision: “Camson visualises a healthy and disease-free society by providing safe food”
Mission:“To be a world-class manufacturer of biotechnology products which are effective, non-poisonous, eco-friendly, zero-residue and cost effective through state-of-the-art technology, backed by on-going research and development activities thereby providing good health to all.”
Agenda
Source: 5
Overview
IndustryCompany profile
Future Roadmap
Growth Drivers
Financials
Indian Agriculture Industry
Source: 6
Growing PopulationReducing Arable Land due to
Rapid Industrialisation Use of Crops as Bio-Fuels
Food Scarcity Crisis
Will require high yield seeds & bio-fertilizers to improve agriculture productivity
India would be short of 14 mmt of food grains by 2017 if the present growth rate of food grain production continues.
Source: Govt. of India
Expected to grow from 1.1 bn in 2009 to 1.9 bn by 2050
Source: UN Population Division (2005)
Per capita availability of agri land
Source: Union Agriculture Ministry (2006)
0.33 ha 0.14 ha 0.05 ha1951 2001 2035
Industry Overview – Agrochemicals (Pesticides)
Source: 7
Global Agrochemicals Industry
Global Agrochemicals Industry grew at a CAGR of 9.3% from 2003 to reach US$ 41.7 billion in 2008.
Herbicides (45%) and Insecticides (33%) are the largest consumed agrochemicals.
Expected to grow at 7.5% from US$ 1.36 bn (2009) to US$ 1.7 bn (2012).
4th largest producer in the world after the US, Japan and China.
Produces 16% of the world’s food grains; responsible for only 2% of world’s pesticides usage.
Approx. 18% of the crop yield worth Rs. 900 bn is lost due to pests every year in India.
Indian Agrochemicals Industry
Pesticide Consumption in India
Global Pesticide Consumption
Source: SBICAP Report, Mar 2010
6.0
2002
2.3
2001 2008
41.7
2007
9.9
2006
2.6
2005
1.6
2004
15.0
2003
Yoy growth (%) Market size
US$
bn
(%)
Chilli OthersRice VegetablesCotton Wheat
9%12%25%
MaizeFruits & Veg OthersCotton SoyaRiceSource: CARE Report, Mar 2010
Industry Overview – Indian Seed Market
Source: 8
6th largest seed market in the world. Estimated to be Rs. 49-55 bn.
Growing at 12-14% annually vis-à-vis global market which is growing 4-5% annually.
Categorised into:− Biotech trait suppliers− Hybrid seed players / breeders− Companies that provide seeds to farmers
Constituents− Public Sector: Mostly focus on high volume
low value certified seeds such as pulses, wheat and soybean
− Private Sector: Focus on high-value hybrid seeds such as cotton, cereals and vegetables
Currently exports account for less that 5% of the total hybrids market in India
The country exports predominantly to South-East Asian countries Source: SBICAP Securities Research
Indian Seed Market Size (Approx. Rs. in bn)
Indian Seed Market
Farm Saved Seeds – 75%
Commercial Seeds - 25%
Public - 24% Private - 75%
Unorganised (without research
capabilities) 43%
Organised (with research
capabilities) 57%
Hybrid Seeds v/s Genetically Modified (GM)
Source: 9
Difference
Long-term Effect
• Taking desirable gene sequences from other plants (and even animals)
• Result of a new technology that may have serious drawback
• Little is known about the long-term effects on the consumer of the extra gene sequences.
Genetically Modified (GM)
• Crossbred species of a two closely related but different parent vegetables
• Hybrid vegetables have a favorable public opinion since they have existed naturally for centuries
Process
• Only happens in the laboratory because it combines DNA from organisms (plants or animals) outside of a vegetable's species
• Hybridisation happens regularly in nature when closely related species cross-pollinate
Hybrid
Advantages of using Hybrid Seeds in Horticulture
Source: 10
Higher Returns to the Farmers
Greater Productivity
Better Adaptability
Better Quality Produce Fresh, attractive and
free from disease Better transport
quality Suitable for processing
Increase in the yield per unit area per unit time due to the development of varieties with high yield potential, early maturity and improved plant architecture
Have wider adaptability to various environments
Possess the characteristics suited to off-season production
Commercial sowing in off-season gives high yield and better economical income to the poor growers
Agenda
Source: 11
Overview
Industry
Company profile
Future Roadmap
Growth Drivers
Financials
Milestones & Achievements
Source: 12
Exclusive Agreement with Government of Uttarakhand
2004-05
2005-06Collaborative Research Agreement on Molecular Genetics with the University of Dharwad, Karnataka
2007-08Identified as One of the Fastest Growing Technology Companies and placed at 17th in the Technology 50 India 2008 Programme conducted by Deloitte Touche Tohmatsu, Asia Pacific
2007-08
In-house R&D Unit recognised by Govt. of India, Ministry of Science and Technology, New Delhi
2009-10
• Procures land for 3 production units in Nangal(HP), Kotabagh (Uttarakhand) & Aligarh(UP).
• Launch of “Sonmat”, yellow skinned watermelon.
• Launch of Cherry tomato• Launch of “Calbase”- Biocide for soil
application.Started Operations
1993
1995Became a Public Limited Company
Camson’s Pioneering Products
• First Indian company to launch a seed variety giving yellow tomatoes
• First Indian company in India to research, produce and market unique seeds like ice box watermelons under 3 kilos out of their own R&D facilities
• First Indian company to produce watermelon with yellow skin
Business Segments: Complete Solutions for Farmers
Source: 13
Currently its business consists of 3 verticals - seeds, biocides and bio-fertilizers
Seeds Proven track record of hybrid
vegetable seeds Range of over 49 varieties Pipeline of an additional 70
more varieties
Biotech products (Zero-residue)
Biocides In house library of 3700
selected and characterised microbes
Effective in controlling various pests and pathogens
Leading edge in innovating/ formulating effective biocides
Bio-fertilizers Effective mobilisation of
nutrients to plant Reduce the need to use
chemical fertilizers by restoring the soils natural nutrient cycle and enhancing the soil conditions
Challenges for Farmers Solutions by Camson Hybrid Seed varieties - Offer maximum compatibility with organic and
natural conditions and better yields Bio-fertilizers - Unique combinations of bio-agents that enhance the
concentration of plant nutrients in the soil Zero-residue Biocides - enable farmers to access higher-value
markets by meeting stringent requirements on pesticide residue levels
Supply to the increasing global demand for food
Reducing the negative impact of crop protection practices on consumers, farm workers and the environment
Strong Product Portfolio
Source: 14
Revenue Contribution Approximately 64% Approximately 36%
Product Features
• Longer shelf life• Higher realisation due to unique characteristics• Offer great protection period• Pests/insects do not develop resistance to biocide even after multiple uses• Fewer sprays, in turn saves labour cost• Greater yield per acre• Zero residue product• Can be used along with chemical pesticides• Cater to wide range of crops
Product Segments Hybrid Seeds Biotech Products (Bio-fertilizers and Biocides)
Product Matrix (till date)
Hybrid Seeds (48 varieties) Biotech Products Type (27 Variants)
1. Watermelon (5)2. Tomato (11)3. Chilly (4)4. Brinjal (15)5. Okra (3)
6. Bitter Gourd (4)7. Bottle Gourd (2)8. Sponge Gourd (2)9. Sweet Corn (1)10. Musk melon (1)
• Biofungicides (6)• Bio Insecticides (9)• Bio Stimulants (6)• Bio-Fertilisers (6)
Pioneer Products
Source: 15
Product Major Crops For Control and Elimination of
Calphomil Veg, Fruits, Flowers and Cereals Fungal infection like downy mildew, phytopothora, pyhium, wilt, blast
Calnova Veg, Fruits and Flowers Mites(sucking pest), Thrips
Calstim Veg, Fruits and Flowers Bio-stimulants
Caltika Veg, Fruits and Flowers Plant tonic
Calpaste Veg, Fruits, Flowers, Cereals and Cotton Insecticide for all soft bodied insects
Calbahaar Veg, Fruits, Flowers, Cereals and Cotton Prevention and control of soil borne pathogens and insects
Biocides Product Portfolio
Seed Product Portfolio
Key Crops Brands Description
Watermelons Netravati and Vedavati • Higher margin product and expected to be future growth driver
Tomato Ganga, Songanaga and Akash Ganga
• The second highest revenue earner• First Indian company to launch a seed variety giving yellow tomatoes
Chilies Gomti and Pennar• Gomti chilly is dark green with 8-10 cm length.• This variety of seed has been the highest gross earner for Camson.
Location and Target Markets
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Target Farmers :
Locations
Currently active in Six States –Andhra Pradesh, Uttar Pradesh (including Uttaranchal), Maharashtra, Madhya Pradesh, Karnataka and Haryana
These six states account for 85% of sales Intends to expand on pan-India basis and
enter in International markets
Three categories Category A : Export oriented farmers. Category B : Who have not been able to
find remedial solution for a particular pest/disease
Category C: Who understand harmful effects of chemical pesticides
Currently ,the company is setting up a production unit in Uttarakhand to cater exclusively to the Northern India market
Camson has research center in Aligarh, Uttar Pradesh
Headquartered in Bangalore, Camson has a 25 acre R&D centre and production facility in Dodaballapur; also in process of developing another R&D center in Dodaballapur
Target Markets
Setting up a production facility in Nangal, Himachal Pradesh
Sales & Distribution Network
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13 Branches all over India Dedicated team of 300 marketing professionals across India Wide, well-connected network of 300 distributors and 2,600 dealers across India
CAMSONMarketing
Sales Officers
Demos Free Consultancy
Authorised Distributors (AD):Obtains product at a lower price than APD
Authorised Preferential Dealer (APD):Larger retailer at taluka level who also supplies to some retail shops
Retail Shops
Field Assistants
Distribution is through its Bangalore centre. Seeds are normally couriered immediately and delivered within 3-4 days.
For biotech products which have a longer shelf life and are much more bulky, Camson has Clearing & Forwarding agents across the country for storage and handling
Employs Field Assistants at local level on a temporary basis during sales promotions
To reach farmers directly organises various kinds of trials and demonstrations
Give general advice to farmers on various products and also write out “prescriptions” on appropriate usage of biocides along with seeds
Manufacturing Facilities
Source: 18
Location Karnataka (Existing)
Karnataka(New building) Nangal (HP) Aligarh (UP) Kotabagh
(Uttarakhand) Total
Type R&D Facility Biocide plant R&D Lab Biocide plant
Land Area (Acres) 20 1.8 12 1.5
Area (Building) 45,000 sq.mts 30,000 sq. ft 40,000 sq. ft 6,000 sq. ft 30,000 sq. ft
Capex (Rs. mn) 100 80 10 80 270
Capacity (ltrs on a per shift basis) 900,000 NA 900,000 NA 800,000 2,600,000
Expected Operational Date - 31-Mar-12 31-Mar-11 31-Mar-12 31-Mar-12
Tax exemptions in biocides units in Nangal and Kotabagh
Manufacturing Facilities Quick Facts
Have been set up in southern and northern parts of India, keeping in mind the diverse demand in both.
Supported by well-equipped and internally connected storage facilities covering key locations in India.
Currently, has one facility at Dodaballapur in Bangalore Setting up additional facilities in Uttarakhand and Himachal Pradesh Seed multiplication is through contract farming at different locations Total area under contract farming is approx. 1000 acres Contract production (Hybrid seeds) spread over 1000 acres in
Karnataka, Andhra Pradesh and Tamil Nadu Tax advantage for the 25 acre centre in Dodaballapur which has
agricultural, residential and industrial units housed within it
Strong R&D Capabilities
Source: 19
Strong focus on in-house research capabilities has resulted in successful portfolio of products over the past 3 years
• 22 biocides
• 7 bio-fertilizers
• 17 hybrid seeds• The ongoing research will add another 70 more varieties of
seeds
Entire Biocides research process takes about 9 - 12 years
• Has already established over 3,700 selected microbes
Entire Hybrid Seeds research process takes about 5 - 6 years
• Has a large number of selected nucleus germplasms
R&D Facilities
• Already has its 25 acre R&D centre and production facility in Dodaballapur
• R&D facility in Aligarh, UP & planning to set up another R&D center at Dodaballapur
Recognition • In-house R&D Unit recognised by Govt. of India, Ministry of Science and Technology, New Delhi
Developed a proprietary technology platform
• Consisting of a microorganism database, screening technology and a natural product compound library
Camson's ability to leverage its proprietary technology platform combined with frontier science continues to advance Camson's reputation as a leading innovator in the biotechnology space
Camson’s Zero Residue Farming Products
Source: 20
Biocides
Bio-fertilizers
MicrobialSecondary Metabolites(Bio-agents beneficial to soil
conditioning and improve the plant physiology and produce)
Based on Formulates of
Production of Biocides and Bio-fertilizers
Organically derived biocides and bio-fertilizers to protect crops and enhance growth
Difference
Synthetic Chemicals Biocides and Bio-fertilizers
Pests develop efficacy They cause acute and chronic health
effects Affect the equilibrium of agricultural
systems and the environment Also lead to socio-economic problems in
the farming community
Mobilize the micronutrients in soil to maximise their utilisation by the growing plant
Work specifically against certain pests, without harming other organisms
Since they are living strains, they assimilate into the ecosystem without leaving any toxic residue
Due to recent technological advances and increasing environment and safety concerns, biologically-derived products are becoming increasingly important components of Integrated Pest Management
Management Team
Source: 21
Management team comprises of a core team of 35+ senior technocrats, scientists and sales professionals
Name Designation Qualification Experience
Mr. Dhirendra Kumar
ManagingDirector
M.Sc. Ag., MBA Total of 27 years of experience. Has extensive expertise, especially in promotion and marketing of agricultural products.
Mr. A N Singh Non-Executive Director
M.Sc. Ag Has worked for over 40 years in the agricultural sector. Was with the Ministry of Agriculture, Govt. of India & retired as Additional Commissioner. This was followed by assignments as a Consultant to the World Bank.
Krishnaswamy Ramaswamy Iyer
Non-Executive, Independent Director
B.A (Hons), LLB, CAIIB
Has over 42 years of experience in the banking and financial services industry. Has held positions like DGM, SBI; President, San Paola Hambro Finance; MD, EXIM Bank of Tanzania & CEO, Nepal Industrial & Commercial Bank.
Virendra Kumar Singh
Non-Executive Director
Master of Engineering degree, MBA.
He has worked extensively in the automobile sector, innovating and developing new vehicle prototypes, and managing production and sales. He has also been a first-generation entrepreneur running a successful venture of environmentally-viable infrastructure focused on the gainful use of solar energy.
B. C. Madappa Non-Executive, Independent Director
Bachelor of Science degree
Madappa has over 30 years of experience in media and allied industries. He was responsible for the creation and incubation of India’s first professional PR firm and also India’s first direct marketing firm in collaboration with global industrial leaders.
Dr Anirudh Kumar Singh
Non-Executive, Independent Director
M.Sc. in Plant Pathology and a Ph.D
He has over 30 years of experience in Plant Genetics and BreedingDr Singh has published several research articles in reputed national and international scientific journals.
Sanjay Agarwal Non-Executive, Independent Director
M.Com. Agarwal has over 20 years of experience in managing finances, backward integration and global expansion. For over two decades, he has played a major role in making K S Oils a successful and globally integrated venture
Agenda
Source: 22
Overview
Industry
Company profile
Future Roadmap
Growth Drivers
Financials
Shifting demand from Pesticides to Biocides
Source: 23
Hence, the potential of Biocide market is the total Pesticides market
(US$ 1.7 bn by 2012 in India)
India currently consumes only 2% of world’s pesticides usage resulting in large amount of crop yield loss (~18% of the crop yield worth Rs. 900 bn) every year
High emphasis on achieving food sufficiency is expected to drive huge demand for crop protection products in future
Huge Expected Future Demand
20% of food products with residue above tolerance level in India compared to world average of 2%
Impact from use of Pesticides
The increasing awareness about poisonous chemical pesticides will shift the demand from pesticides to Biocides which are very effective and eco-friendly
Biocides as Replacement for
Pesticides
Low usage of Crop Protection
Products at Present
Source: SBICAP Report (Mar, 2010)
Growth Drivers
Source: 24
Apart from above factors, increasing demand for organic products together with increasing awareness, growth of Horticulture & Floriculture, support from Government and lower cost of usage is expected to drive future demand for Bio-tech products
Increasing Population Rising Per Capita Income
High emphasis on achieving food grain
self sufficiency.
Limited Farmland Low YieldUse of high yield seeds
& bio-fertilizers to improve productivity
Low access to fertilizers & high yield seeds by neighboring countries
India’s vast collection of germplasm coupled with its R&D capabilities
India to emerge as an export hub
Increasing min. support prices of agricultural crops
Rising demand for commodities
Driving the use of quality agricultural
inputs
Agenda
Source: 25
Overview
Industry
Company profile
Future Roadmap
Growth Drivers
Financials
Ready to lead the Agricultural Biotechnology Sector
Source: 26
Competitive Advantages
All set to leverage the hard work put in over the last one and half decades. A typical biocide research takes 9 – 12 years. Similarly it takes 5-6 years to launch a new hybrid.
India's first wholly integrated agricultural biotech company with presence in hybrid seeds and agricultural biotech products
Has a first mover advantage in certain product categories. Its future growth will depend on its ability to leverage the growth potential in replacing the chemical pesticides using the residue-free platform.
Equipped to Spearhead the Agri- Biotechnology Sector
Integrated Player
First Mover Advantage – Biocides
Camson @ Inflection Point
Surmounting Challenges
Source: 27
The company can however patent the hybrid seeds in the US. However, through the Plant Breeders right which would be implemented from Sept/Oct 2010, the seeds of a company are protected and can also be licensed.
Hybrid seeds cannot be patented in India Patent Filing
However, the new facilities being set up will take care of these concerns.Unexpected increase in demand
Production Capacity
Camson’s products have already been received enthusiastically by the farmers.It has adopted a multi pronged approach through demos, advertisements and disseminating information of good farming practices & success stories of products
Illiterate farmers and hence poor acceptability
Illiterate farmers
Camson’s Goals
Source: 28
Capitalising on strong and well-balanced portfolio with a special focus on innovative bio-products
Remaining focused on innovation and operational excellence
Focusing R&D efforts on developing effective technologies for raising crop productivity, protecting the environment and improving health and quality of life
Agenda
Source: 29
Overview
Industry
Company profile
Camson Advantage
Future Ahead
Growth Drivers
Financials
Financial Highlights
Source: 30
Particulars FY 2005-06 FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10
Revenue 8 18 42 49 80
EBITDA 3 4 9 10 17
EBITDA Margin 30% 25% 21% 19% 21%
PAT 2 3 8 8 15
PAT Margin 22% 19% 19% 16% 19%
Amount (Rs. in cr)
First Quarter Results – FY 2010-11
Source: 31
Particulars Q1 FY 2010-11 Q1 FY 2009-10 Change %
Revenue 20.71 19.65 5.39%
EBITDA 5.29 3.98 32.91%
EBITDA Margin 25.6% 20.3%
PAT 5.41 3.72 45.43%
PAT Margin 26.2% 18.9%
Source: 32
Appendix
Regulatory Aspects – Current Regulations
Source: 33
Provide basic regulatory structure to ensure seed control in India. The Act provides for compulsory quality control and voluntary certification of seeds of any notified kind and variety and truthful labeling of seeds. The Act also created the various seed regulatory bodies and defined their functions & provided guidelines on minimum limits of germination and purity, regulation of the sale of seed, certification, etc.
SEEDS ACT, 1966 &SEED Rules, 1968
• This order was issued under the Essential Commodities Act, 1955, and provided the procedure for registration of every person carrying on the business of selling, exporting or importing seeds of a notified kind or variety.
Seeds Control Order, 1983 (under the E C Act, 1955)
• This policy relaxed norms for the import of technology and parental material, and opened the doors to MNC seed companies. However, the policy allowed imports only if the foreign supplier supplies the parental line seeds or breeder seeds to the Indian company within two years of the first consignment.
New Policy on Seed Development, 1988
• It recognises the need to protect the plant breeder’s right so as to stimulate R&D in both the public and private sector. It defines the process for plant variety registration and also requires disclosure of the expected performance under given conditions. The Act gives the farmer the right to claim compensation if the seeds does not perform as expected. It also extends the breeders’ right to production, selling, marketing, distribution, export and import of seeds and/or propagating material of protected variety.
The Protection of Plant Varieties and Farmers‘ Rights Act (PPVFR), 2001.
The Protection of Plant Varieties and Farmers‘ Rights Act (PPVFR), 2001.
• This policy laid down the foundation for comprehensive reforms. It included implementation of an effective sui generic system for intellectual property protection to stimulate investment in R&D of new plant varieties. The policy also acknowledged the need to adopt technology and protect the farmer from exploitation.
The seeds sector has witnessed many changes since 1966 when the existing Seeds Act was passed. These include new technologies such as GM seeds and the entry of private and foreign seeds companies. In order to address these changes, the proposed Seeds Bill, 2004 seeks to replace the Seeds Act, 1966. The changes include regulation and registration of all seeds to be sold (instead of only notified kinds), provisions for self-certification and accreditation of private seed testing laboratories, and regulation of transgenic seeds.
Regulatory Aspects – Seed Bill 2004
Source: 34
Aim of the BillRegistration of
Seeds The Bill aims to
regulate the quality of seeds sold, and replaces the Seeds Act 1966
Transgenic variety of seeds will still need clearance under the provisions of the Environment (Protection) Act, 1986 before being registered. A variety of seed containing any technology considered harmful or potentially harmful shall not be registered.
All varieties of seeds for sale (except those sold by farmers directly) have to be registered. The seeds are required to meet certain prescribed minimum standards
The Bill proposes to establish a Central Seed Committee CSC), which may appoint Sub Committees as ‐needed. One of the subcommittees will be the Registration Sub Committee, which shall maintain a National Register of Seeds for all varieties of seed.
Every State Government will establish a State Seed Committee which will have an advisory role
Farmers’ Rights The Bill protects the
right of a farmer to save, use, exchange, share or sell his farm seeds and planting material
However, the farmer cannot sell seeds or planting material under a brand name (if he does then they have to be registered)
Also, all seeds sold by farmers need to conform to the minimum standards regarding germination, physical purity and genetic purity applicable to registered seeds
Consumer Protection
For all registered varieties, seed producers, distributors and vendors have to disclose the expected performance under certain given conditions
If a registered variety of seeds fails to perform to expected standards, the farmer can claim compensation from the producer or dealer under the Consumer Protection Act, 1986
Certification & Registration of
Seeds The Bill permits self
certification of seeds by accredited agencies and allows the central govt. to recognise certification by foreign seed certification agencies
Every seed producer and dealer, and horticulture nursery has to be registered with the State Government.
The Seeds Bill was introduced in the Rajya Sabha on 9 December 2004. Through registration and certification, the draft law seeks to promote quality seeds
Source: 35
Thank You
Camson Biotechnologies LtdNo. 223, First Main, Domlur Second Stage, Bangalore - 560071.Tel: 0091 080 2535 5138 Fax: 0091 080 2535 2232Email: [email protected] Website: www.camsonbiotechnologies.com
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