MUMBAI (Commodity Online): K S Oils Limited (BOM: 526209), one of India's leading FMCG led integrated edible oil company and the leader in branded mustard oils, posted a 29% rise in the turnover for the second quarter FY 2009-10.

The company clocked a turnover of Rs.947 crore during the second quarter FY 09-10, which was an increase of 29% from Rs.734 crore during the corresponding period of the previous year.

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Meanwhile, company’s stocks on the Bombay Stock Exchange (BSE) appreciated by close to 20% during past three months from Rs.53.59 to the recent level of Rs.64.05. However, the stock price fell marginally at Rs.64.05 on Friday.

The unabated consumer demand from the domestic markets was the key drivers for the company’s growth. The strong consumer demand and newer market penetration, especially in rural areas helped the company register higher per unit margins and register higher profits.

The company reported a profit after tax (PAT) of Rs.50.18 crore for the quarter ended September 30, 2009 as compared to Rs.42.22 crore during the corresponding period of the previous financial year.

Announcing the results, Mr. Sanjay Agarwal, Managing Director, K S Oils said, “The Indian consumption story is strong as ever. Robust local consumption led demand and our brands Kalash and Double Sher led FMCG brand play is helping us get higher volumes and better margins. We believe the next round of sustainable growth will come from small cities, towns and rural India. We are geared to create a Pan India presence and reach out to consumers in the heartlands through products which are pure and healthy, convenient and value for the entire family. We will persist to leverage our portfolio of dominant brands to strengthen leadership in our core categories.”

He further added, “The Government of India’s strong campaign against adulteration in mustard oil has helped organized players like us. A distinct consumer shift to branded mustard oil brands for quality, purity and guarantee of good health is helping brands like Kalash grow on a pan India level.”

The company continues to build significant scale in palm oil plantations globally with over 1, 38,000 acres of palm plantation land under development in Indonesia and Malaysia. Like other parts of the world, in India, palm oil is the most consumed edible oil.

Today, over 50% of the Indian edible oil demand is being met through imports of which Palm constitutes as high as 80%.

Successful agri-asset creation like palm oil plantations across the globe by Indian companies will help build a self reliant food security for Indian consumers. The branded play in mustard oil which KS did successfully in last 3 years will be replicated by the company in the soybean and palm oil sector also.

K S Oils is going ahead with its backward integration project to develop palm plantations in Indonesia and Malaysia. During the quarter, the company acquired an additional 53,000 acres of land for palm plantations in Indonesia, owning a total land bank of 1,38,000 acres.

The Indonesian and Malaysian oil palm foray will assure supply of palm oil to India. The acquisition and funding was done through K S Oils fully owned subsidiary K S Natural Resources, Singapore.

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