How katha (catechu) - a vital ingredient of the ubiquitous paan (betel leaf savoury) in India - promises robust growth opportunities in the future. As Indian Wood Products (IWP) - the largest manufacturer of katha in the world- gears up to celebrate 2020 as the Centenary Year, India Blooms catches up with Chairman K K Mohta to share his views.
Indian Wood Products Co. Limited (BSE: IWP) - Kolkata (India)-based largest manufacturer of branded catechu or katha in the world – which is celebrating 2019-20 as its Centenary year is drawing up an ambitious plan to expand its business at home and abroad.
Katha, which is primarily extracted from khair tree, is a vital ingredient of paan or customized betel leaf savoury in India, has a huge potential in the pharmaceutical sector. The size of the overall retail market for katha (catechu) in India is estimated at Rs 3000 crores at present. Katha is also used for medicinal purposes and in Ayurvedic preparations. However, the Indian katha market is dominated by the unorganized sector and rampant substandard quality of katha is a major cause of concern.
Indian Wood Products (IWP) is aiming to further consolidate its market position by embracing new technologies and through forward and backward integration to raise the quality of the product. IWP is into manufacturing and retailing of branded katha and retailing in branded packed spices. Kathaaccounts for over 90 per cent of the company’s revenues.
“Though the main katha market is in India, we are giving due weightage to expand our overseas business network in order to emerge as a market leader in all categories of katha, including premium and white katha segments. Being a market leader and the largest manufacturer, we are consolidating our presence through use a mix of latest technology, best management practices and sourcing of quality materials globally. The katha market is full of promise in the coming years as it becomes more and more organized,” said K K Mohta, Chairman, IWP.
“Spreading awareness against adulteration of katha remains a major task. As a market leader, we have taken it on ourselves to bring to the market the best quality katha. Our Rs 20-crore greenfield project in Jammu is a major catalyst in this respect,” Mohta said.
“We have been strategically procuring raw material at lower costs from Indonesia, Myanmar, Vietnam and other countries. We are also scouting for business opportunities and strengthening our International supply chain network which can also be leveraged for our spice business in the near future,” Mr Mohta said.
IWP also operates through PT Sumatra Resources International, at Pangkalan, West Sumatra, Indonesia, for production of semi katha extracts through a technology which is being used for the first time. The entire production is imported to India for manufacturing better quality of katha. The company also has sourcing agreements with companies in Myanmar and exploring similar opportunities in Vietnam.
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