RACL (Regaal Resources Limited)

Overview of Agriculture statistics and performance

• In Fy 23 there was good growth of 10 percent increase in total crop and 30 percent increase in total maize production. 

• FY 24 has seen a decrease in both production of maize and crop since fy 23

• India is the 6th largest Maize producer. 

• While it was growing at a steady rate between fy 20 and fy 23 because of El Nino there was less rain fall leading to less crops in fy 24. 

• They have potential to increase production to 50 million tonnes from 38 million tonnes. 

Market Overview

• Starch is one of the most important polymers being used in both food and non food applications. Maize starch is used in industrial applications and a bit in food. The industrial uses are Paper, Textiles, Pharmaceuticals, Bioplastics, and chemicals.

• 62 percent of maize consumed is because of animal feed while 17 and 13 percent is biofuels and food. In India it is different as while animal feed dominates the market food uses is 30 percent while bio fuel is only 3 percent. 

• Key growth drivers for Maize industry are increasing demand for ready to eat foods (most of which contain maize flour), and growing organised dairy sector. 

• Maize prices have risen to past 2000 per quintal. 

• Most of the Maize gets produced in Karnataka, Bihar and MP.  But they only have manufacturing plants in Bihar. 

• Seasons in which Maize is produced is rainy and winter. 80 plus percent is done in Rainy. 

• Imports of Maize have been decreasing significantly while exports have almost 4x gone up. 

• Most of the Maize exports go to Malaysia then Thailand.

• Maize production is very hard to enter into because of economics of scale and high capital investment needed. 

• Most of the global big brands are not in Asia region and are in Europe and North America

• North America is the largest consumer of maize

• Maize oil is a rising product in India.

• Some opportunities for the Indian maize market are biggest population, eco friendly packaging, preference for ready to eat food, and uses in many different markets.

• Some challenges are high prices for raw materials, based on weather conditions, post harvest losses. 

• Another use for Maize is the modified starch which is where all the industrial uses come in. 

• Biggest modified starch is used in adhesives.

• Some growth drivers for the modified starch field is Multi purpose, uses in industrial applications increasing, and rising use in beauty and cosmetics. 

• Some challenges are raw material availability, poor infrastructure, and price volatility. 

• Maize starch is also used in liquid glucose which makes up a lot of candy and chocolates. 

• RACL is by no means the largest and only has one manufacturing plant in Bihar. 

Business overview

They are focused on manufacturing maize starch, modified maize starch, some co products including Gluten, enriched fibre and fibre, and value added products including , maize flour, icing sugar, baking powder and custard powder. 93 percent of their total orders are done domestically. Most of their main partners are in the paper industry. The source most of their Maize through domestic channels and cultivators. Some of their competitive strengths are their manufacturing facilities are close to local producers, efficient procurement strategy, Diversified portfolio of end uses, and an established and widespread sales network. Some of their strategies include expansion, manufacturing broader and more products, and getting rid of debt. Overall in India Maize consumption is expected to increase because of the rising population and increasing need for Maize.