Suumaya Industries acquires 51% stake in payAgri
Suumaya Industries is an emerging diversified conglomerate group having recently ventured into the agri-commodity business through its 100% subsidiary Suumaya Agro. The company has acquired a majority of 51% stake in payAgri Innovations, a tech-driven agri and food business company solving the problems of key players - farmers, processors and consumers in the agri value chain for an undisclosed valuation under the leadership of chairman and managing director, Ushik Gala.
Suumaya Industries has continued its accelerated growth momentum and showcased exemplary performance in the first quarter of FY2021- 22 due to its diversification and aggressive growth strategy into the agri commodities business. The company is building a holistic agribusiness model to explore multiple avenues like B2B, B2C through its retail foray, corporate, etc. payAgri's 'Seed 2 fork' phygital business model, with a strong farm-gate supply chain expertise and holistic selling capabilities, thrives on creating a better livelihood for farmers and good value for consumers.
Gala said, "Suumaya Industries has embarked onto an ambitious journey with Suumaya 2.0 strategy diversifying into the agribusiness is a new pathway for the company which is unfolding new opportunities and markets for us. The company has already made substantial inroads into the segment. We are most certain that this highly scalable and sustainable business would be the next big growth engine for the company. Agribusiness has been instrumental in the robust financial performance of the company. Within few months, the company is positioned as one of the leading organized players in the agri value chain. In line with this vision, the company is also exploring various inorganic opportunities to be recognized as a significant player driving the sector in unchartered frontiers."
He further added, "The company through our wholly-owned subsidiary Suumaya Agro is acquiring payAgri, a fast-growing 'Seed 2 fork' start-up poised to become a global leader in agri and food business. This will enable Suumaya Agro to gain a strong foothold in the agri value chain business in India. Agribusiness is witnessing strong traction. We would be differentiating our approach in the entire agri value chain and endeavor to be dominant player in the segment."
"The capital infusion by Suumaya Industries will help drive the growth and expansion of payAgri as a farmer-centric value chain focused hybrid bulk and retail supply chain model. We are excited to partner with Rajkumar KVM and Rajeev Kaimal, first-generation entrepreneurs who have created a strong business through their market acumen and perseverance. There is a great synergy as it will give access to Suumaya in the Southern markets, entry into higher value agri commodities, a wider range of customers, and vast access to the farmers' network, which are the key strengths of payAgri.
The investment in payAgri underlines our commitment to exponentially grow the agribusiness and see huge potential in the new commerce agri-fintech, which will further boost the digital ecosystem for millions of farmers, consumers, and agro and food MSMEs. We look forward to working with the highly experienced management team of payAgri as we further expand the business going forward."
KVM Rajkumar, co-founder and managing director (Bulk Value Chain Business), payAgri Innovations, said, "We are building a unique and workable 'seed to fork model' with a focus on Spices and Grain value chains. We are excited to see the acceptance and appreciation from our B2B customers, especially food processing MSME customers, for our quality and supply reliability. We never failed to honor supply commitment irrespective of pandemic and flood situations. We plan to scale up our bulk value chain business by onboarding 100+ MSME & Overseas buyers and increase our wallet share to min. 50% of their procurement requirements in the coming 12 months."
"We are delighted to have Suumaya Agro as our investor as they can leverage their huge business network to propel us to achieve fast-track growth, besides their equity investment and continuous working capital support. The investment will help us to invest in critical farm-gate and supply chain infrastructure, expand our FarmConnect Hubs within and outside India and also strengthen our tech platforms."
Rajeev G Kaimal, co-founder and managing director (Products & FinTech Business), payAgri Innovations, said, "At payAgri, we aimed to build a sustainable, inclusive model in the agri value chain space keeping farmer interest at the core. The solutions we provide from market linkage, technology linkage, and financial linkage help farmers and farmer institutions and the various actors in the value chain. With this investment support from Suumaya, we aimed to take this model across geographies in the coming months and establish ourselves as a prominent player in the agri value chain space providing unique tailor-made market and financial solutions to the various value chain players."
Suumaya Industries has shown exponential growth by building a fully integrated value chain from farmers to its customers. The company has recorded an impressive quarter with a significant increase in the total revenues and profits for Q1FY2021-22. Consolidated Revenues for the period stood at Rs 6,852 crore at 2.3x over the previous corresponding quarter. PAT grew by 16% sequentially to Rs 306 crore in the same period. Suumaya Industries has efficiently managed to simplify the complex agri supply chain. The company has expanded the product basket from staples to value-added agri commodities like spices and increased its geographical footprint to derisk its portfolio and enhance profit margins.
payAgri presents Suumaya Industries with an exciting and differentiated opportunity to have a meaningful play in agribusiness. The company has built a healthy portfolio of the farmer and farmer institution intervention through the payAgri model. The number of Farmer Producer Organisations (FPOs) registered with payagri is 70, whereas the number of farmer members covered are 70,000, and the number of farmers produce and products listed on the payAgri online market are 210. payAgri, a robust agri-fintech organization that orchestrates and digitizes the entire transaction in an agri value chain, operates on three functions, which are removal of the array of intermediaries in the agri value chain through direct linkages, create a cashless ecosystem and provide the benefits of large scale farming to smallholding farmers.