What is it that makes animal migration such a magnificent spectacle for the eye and the mind? Is it the sheer abundance of wildlife in motion? Is it about the steep odds that need to be overcome? Or is it about the amazing feats of precise navigation? The answer is all of the above. But there’s another reason why the long-distance journeys of wildebeests, zebras, Sandhill cranes, monarch butterflies, sea turtles and so many other species inspire our awe. A non-scientist, risking anthropomorphism, might say, ‘Yes, they have a sense of a larger purpose’. Animal migration is a phenomenon far grander and more patterned than animal movement. Migrating animals maintain a fervid attentiveness to the greater mission, which keeps them undistracted by temptations and undeterred by challenges that would turn other animals aside. It represents collective travel with long-deferred rewards.”
You might be wondering what this passage from National Geographic magazine has got to do with investing. Interestingly, this phenomenon of migration has a lot of commonality with a few companies that have chosen to migrate up the value chain, embracing a long grind with back-ended rewards. KRBL and its management team exemplify many such characteristics.
KRBL has had three generations of involvement with the aromatic basmati grain. With a milling capacity of 195 metric tonne an hour, KRBL is the largest rice miller and basmati exporter in the world. It is an integrated player with deep involvement in every aspect of the basmati value chain, right from seed development to modern farming procurement, grading, processing, aging, packaging, branding and marketing. It accounts for more than 30% of the domestic branded basmati rice market and 27% of the total branded basmati exports from the country. Its domestic sales comprise 55% of total sales, the rest of it being exports. It has leadership positions in the markets of Saudi Arabia, Kuwait, Qatar, UAE and Australia.
The company is also involved in other aspects of the value chain. It produces value-added products such as rice bran oil and non-conventional power made using rice husk as feedstock. (see: Optimum value). The company is also able to generate power from renewable sources such as wind and solar thanks to the technology available with it. KRBL currently has a warehousing capacity of close to 0.5 metric tonne (MT)