Raigam diversifies in short time

Harshini Perera

Raigam Chairman/CEO Dr. Uditha Liyanage

A business which started in 1997 with a few employees has now become a popular brand among the consumers in a short period. Their main product has been soya which was not much popular during that period.

But today Raigam has introduced soya in a variety of flavours. The company has also diversified in a short span of time. Chairman/CEO, Raigam Dr. Ravi Liyanage said. Excerpts of the interview.

Q: What can you say about the diversification of the company?

A: At present, Raigam produces 80 different products. We are also the largest manufacturer of table salt in Sri Lanka. There are more than 200 sales representatives and distribution units in the main ranges. We picked the correct product and we won the market.

Q: How do you compete with the other competitors in the market?

A: Raigam has become the brand leader in certain products. When we introduced certain products there was a huge competition but the competition has become a blessing in disguise.

Therefore, we overcame competition easily. The competition in any market tends to improve the quality of the products for the betterment of the customers.

Q: What was the growth of the company for the last two years?

A: Despite the economic recession, Raigam group recorded a remarkable growth in its performance. Especially the massive and unmatchable performance recorded by one of our subsidiaries operating in the salt industry; Raigam Wayamba Salterns Ltd is noteworthy to mention.

In considering the financial details of this company for the financial year 2008/09, the turnover was Rs 383 mn and the profit after tax was Rs 172 mn, that accounted 45 percent net profit ratio. Comparing with previous year, this company recorded 142 percent revenue growth in 2008/09, while accounting Rs 462 mn total assets as at the end of financial year 2008/09.

Q: What are your main areas and operations around the country?

A: In terms of locations our main operations are in Horana, Puttalam, Tangalle, Millaniya and Trincomalee, which are centrally coordinated by our Head Office established at Lucky Plaza, Colombo 3. Our main factory and store complex is located at Kiriwattudwa in Horana.

In Kalutara, Millaniya we have located our cosmetic manufacturing factory. At the locations; Puttalam, Tangalle and Trincomalee we have established our salterns.

In Puttalam we have established a salt factory and is the one and only salt refinery in Sri Lanka. Further in Puttlam, we have our Associate Company PSL which is one of the main salt companies in Sri Lanka.

Q: What are the new investments taking place in the company?

A: Our new investment is focused on our salt business with the objective of becoming the number one company for salt in Sri Lanka and will position us as “The Salt of the Nation” in a few years time. Our new investment mainly diverts to complete the development of salterns and establishment of salt refineries in the above locations.

With the above investment, our strategy is to operate three salt bases (saltern + salt refinery + distribution channel) which will enable to cater salt to the all market segments including geographically that will surely eradicate salt import and make the Sri Lanka self - sufficient of salt.

We have diversified our portfolio into cosmetic industry setting up a cosmetic factory, Dream Cosmetics to manufacture cosmetic items mainly using herbal ingredients. The factory is set up in the Kalutara district, close to Bandaragama.

We have already started to manufacture sanitary napkins under the brand name of “Aarya” and many other cosmetic and herbal products under many different brand names.

We have already invested Rs 150 million for Dream Cosmetics in the near future and to become the largest supplier in two years time. We also expect to produce the cosmetic items that weren’t possible of producing in Sri Lanka. We expect to diversify into pharmaceutical products as well.

We intend to invest Rs 500 million on Dream Cosmetics (Pvt) Ltd and hope to become one of the largest suppliers of cosmetics in Sri Lanka in two years.

Most of the people believe that personal care items can’t be manufactured locally and it is a high tech industry. Despite the fact, a couple of local industries including us have already proved that we could match the quality of an international brand.

We have started the operation of Eastern Salt Company, Sri Lanka’s largest Saltern, which is double the size of existing largest, Hambantota on a 1805 acres in Nilaveli, Trincomalee.

The operations were inaugurated under the Negenahira Navodaya and we expect to invest Rs. 575 million within a span of four years.

The company will manufacture not only salt but also chemical products such as Caustic Soda as well, in the second phase of the project. A production of 50,000 kgs of Salt is expected to harvest from this saltern and also intend to provide more than 1000 employment opportunities within the first three years.

Raigam will also develop a tourism project in collaboration with the Tourism Ministry since the saltern is started close to the proposed Kuchchaveli tourists’ hotel project.

We have already submitted a proposal to the Ministry.

Q: We heard that your company plans to go for a public listing, is it true?

A: We have decided to go for an IPO in the Colombo Stock Exchange (CSE) for our main subsidiary, the Wayamba Saltern Ltd.

The Securities and Exchange Commission has already approved it and submitted the application to CSE which is processing at present.

We intend to open a share issue within the first part of this year.

We have figured out to raise a total capital of Rs 200 million but we cannot comment on the exact amount until the final approval is granted.

Q: What is your advice to young people who aspire to climb the corporate ladder?

A: My advice is to set personal objectives of what you intend to go for and then plan to achieve them, because most of the people in the present days do not have proper objectives in their lives.

Q: What is your philosophy in life?

A: Do the correct thing with conscience and then you have the correct results.

Q: What is the country you like to visit?

A: China for business and Australia for leisure

Q: What is the place you wish to visit in Sri Lanka?

A: Yala National Park

Q: How do you spend your leisure?

A: I always spend time with my family during my leisure.