Gujarat Ambuja Exports scales down expansion

By Abhishek Shanker & Swati Pandey

MUMBAI (Reuters) - Gujarat Ambuja Exports Ltd (GAEL), one of India's top soymeal exporters, is slowing its expansion plans due to the turbulent market situation, a senior official told Reuters on Wednesday.

The firm, which had plans to expand its crushing and processing capacities, is putting some of these projects on hold but will revise its strategy once the market stabilises, Chairman Vijay Kumar Gupta said.

"We will take a call on our expansion plans depending upon the market situation. We are going a little slow now as it is not the right time," he said.

In April, a senior official told Reuters the firm was to finalise plans to expand crushing capacities both in India and abroad and set up projects overseas by the June quarter.

It has now put off its plan to up cotton yarn making capacity and set up a new biochemical plant, Gupta said, adding it also deferred its planned overseas ventures.

Despite this, the debt-free GAEL expects to maintain its targeted turnover of 20 billion rupees for FY09, and will fund expansion underway through internal accruals.

The firm has a 3-month export order backlog of $100 million and domestic order book of 600-700 million rupees. It expects to realise about 2 billion rupees from its new maize processing plant in Uttaranchal, Managing Director Manish Gupta said.

A planned maize processing unit in Maharashtra is on course with the acquisition of 50 acres of land and has raised capacity at its Gujarat unit.