Once a debt-ridden company, Ruchi Soya has come a long way after it recently posted a profit of Rs 314.33 crore. The company’s stock, acquired by yoga-guru Baba Ramdev’s Patanjali Ayurved in 2019, witnessed a jump from being a penny stock in 2019 to trading at over Rs 1,000 currently. Stating that the Ruchi Soya’s would be majorly their nutraceutical business, Baba Ramdev, the promoter of both firms- Ruchi Soya and Patanjali, talks to Veena Mani of DH about why Patanjali acquired Ruchi Soya and the future of both companies. Excerpts:
You started Patanjali to give India organic foods like edible oil. But Ruchi Soya business is not just about organic foods. Where does Ruchi Soya fit within the Patanjali’s scheme of things?
If we had not acquired Ruchi Soya, Adani Wilmar would have it. FMCG, especially the edible oil business, would have gone into the hand of MNCs, which would be destructive and not in the interest of our country people. They would have sold their products at very high prices. All the day-to-day needs of our people should be met by Indians and not foreign companies. We could not have let them or any other MNC take over a company like Ruchi Soya.
Anything an Indian eats in day-to-day life should be pure, and we should be able to source it from Indian players and not rely on MNCs. Now that we have acquired it, we will play to our strength, and our expertise is in organic and natural oils. We plan to introduce virgin oils, be it palm oil or any other kind of oil. It is a part of the 20% FMCG portfolio we envision for Ruchi Soya. 80% of the business focus would be on nutraceuticals. We want to take it forward and keep thinking of what we can do next other than what is already there in the Ruchi Soya portfolio.
Ruchi Soya and Patanjali recently got into an agreement for Ruchi Soya to get into the nutraceuticals segment with the brand name Patanjali-Nutrela. Is this going to be a one-off partnership between the two companies, or will they continue to work like this?
Both companies have their own identities. Patanjali has a huge research centre, and we will utilise it to its optimum potential. We have decided that Patanjali will not get into manufacturing nutraceuticals or any such products like biscuits. Patanjali will focus on research and market any product that aligns with the growth of Ruchi Soya. This decision will benefit the shareholders of both the companies, especially Ruchi Soya, and is in line with our vision for Patanjali Ayurved.
Some of the products like edible oil are common to both firms- Patanjali and Ruchi Soya. Would you rationalise the portfolio in both companies by hiving off, selling it, or merging brands?
We will not meddle with the kind of products sold in the market. We have put in a lot of effort to work with distributors and other stakeholders to regain their faith and bring Ruchi Soya products back on the shelf. Plus, some of the products like the nutraceuticals business will have Patanjali’s brand name that will help them.
The company does have a lot of debt in its books? Do you have a timeline for the public, especially shareholders, on the company becoming debt-free?
We want to make Ruchi Soya debt-free by December 2021. It is not only good for us, the management, investors and its shareholders that we become debt-free.
It will be our focus. Our Rs 4,300 crore FPO is going to help us in becoming debt-free.
It is raining IPOs in the market. When do we see Patanjali getting listed?
It is on the cards. We will list it at the appropriate time. But for now, our focus is Ruchi Soya.