Back to roots: JSW set to diversify into farm sector
After establishing their stronghold in an array of sectors from steel to power, the country’s fourth largest business family, Jindal Group of Companies, is going back to its roots.business Updated: Sep 11, 2009 20:38 IST
After establishing their stronghold in an array of sectors from steel to power, the country’s fourth largest business family, Jindal Group of Companies, is going back to its roots. The ancestors of the group were farmers from Hissar before patriarch OP Jindal set up the conglomerate.
The Sajjan Jindal-owned Jindal South West Holdings is foraying into agriculture with a new company called JSW Agro. It would set up a national chain of warehouses and cold storages and procure farm products directly from farmers, do value addition if required, and sell them directly to consumers. The company has earmarked a corpus of Rs 200 crore for this purpose over the next one year.
“Our venture will be called JSW Agro and we will set up various agro-based industries across the country,” said Sajjan Jindal, vice-chairman, JSW. “The intention is to help educate the farmer to improve his yield as well as his income, but this is in no way a CSR (corporate social responsibility) activity for JSW. This is a corporate venture and will function as thus.”
Jindal said initially they would not delve into bulk commodities like wheat, barley, pulses or rice. “The beginning will be small and we will stay clear of bulk commodities and operate in commodities like cashew. This would be a new area for us, so we will proceed according to the demands of the market.”
Jindal’s mainstay companies JSW Steel and JSW Energy are emerging out of the shadows of global recession though high debt equity ratio of 1:2 is a cause for concern. “We aim to bring this down to 1:1 in the next 12 months,” he said.