21652 - Ruchi Soya

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Summary of Proposed Investment

Project Number

21652

Company Name

RUCHI SOYA INDUSTRIES LIMITED

Date SPI Disclosed

Feb 19, 2004

Country

India

Industry

Agribusiness and Forestry

Projected Board Date

Mar 21, 2004

Status

Completed

Sector

Vegetable Fats and Oils

Department

Regional Industry - MAS Asia & Pac

Environmental Category

B - Limited

Previous Events

Approved : Feb 15, 2006
Signed : Mar 3, 2006
Invested : Mar 14, 2006

Project Description

Ruchi Soya Industries Limited (RSIL or the company) is the premier company of the Ruchi Group. It is the largest oilseed crusher, importer of edible oils, exporter of oilseed meals and producer of textured soya protein (TSP) in India. It entered the edible oil business in 1986, with primary focus on the sale of refined edible oil in the Indian market.

The project aims to take advantage of the increasingly growing demand of edible oil in India, especially the trend toward the packaged edible oil. The proposed IFC financing will be used in two main areas: The first is to finance two new facilities: a port based refinery at Patalganga near Mumbai (Bombay) and a crushing plant and associated refinery at Butibori near Nagpur both in the state of Maharashtra. The second part is to finance the company’s maintenance capex and permanent working capital, and upgrade edible oil plants and refineries that may be acquired. The Patalganga refinery will rely on imported crude oils and will benefit from a logistical advantage over its competition by being located close to the JNPT/Mumbai ports as well as being close to the major regional market of Mumbai. The Butibori crushing and refining facility will take advantage of the local production of soybeans.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	10.0
Equity	10.0

Development Impact

The project is expected to have several broad development impacts. Firstly, it will improve the long-term financial performance of RSIL, a major direct and indirect employer in the areas of their operation. Secondly, proposed acquisition of inland crushing and refining units will enable transfer of best practices to these units and continued employment of workers in these units. Thirdly there will be direct employment creation in the new facilities at Patalganga and Nagpur. Associated with the opening of these plants will be a period of training and upgrading of the skills of the employees.

IFC’s role would be in three aspects: Firstly, IFC will provide long term capital to the company as other sources of long term financing are generally not available to the company in the current market scenario; Secondly, IFC will endeavor to ensure that RSIL implements best practices in risk management; Thirdly, IFC will advise RSIL on improving its standards of environmental, safety and social guidelines.

This Category B project has a limited number of specific environmental and/or social impacts may result which, can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
Location of environmental documents In locally affected community
The environmental documents will made locally available at the following locations:

State of NAGPUR

1) Post Office:
Purani Basti, Buti Bori
Dist: Nagpur, Pin: 441108

2) Bank:
HDFC Bank Ltd.
204, Mashurwala Marg,
Dharmapeth Extn, Shankar Nagar
Square, Nagpur – 440010

3) Temple:
Durga Mandir
WardNo. 5, Buti Bori
Dist.: Nagpur, Pin: 441108

4) Site:
Post Office Buti BoriDistrict Nagpur
State Maharashtra, India
Postal Pincode 441108

4) Email: www.ruchigroup.com

State of PATALGANGA

1) Post Office:
P.O. Mazgaon
Taluk: Khalapur
Dist: Raigad, Pin:410220

2) Syndicate Bank
Khaira, Patalganga, Pin: 410220

3) Temple:
Devi Mandir,
Village Isambe,
P.O. Mazgaon
Taluk: Khalapur
Dist: Raigad, Pin:410220

4)Site:
Village Esambe
Taluka Khalapur
District Raigad
State Maharashtra, India
Postal Pin Code: 410 220
Website: www.ruchigroup.com

Contacts

For Inquiries About the Project, Contact

V Suresh Kumar, Head of Finance
Ruchi Soya Industires Ltd
408 Tuslsiani Chambers
Nariman Point
Mumbai 400 021

This Summary of Project Information (SPI) is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC's activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC's Disclosure of Information Policy that went into effect September 1998.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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