With Parliament giving its nod to foreign direct investment (FDI) in multi-brand retail, the Rs.121-crore Chennai-headquartered Rinac India Ltd. is re-looking its game plan to cash in on the emerging opportunities.
Rinac offers end-to-end engineering solutions for the cold chain and modular construction industries.
According to R. Krishnan, Chief Executive Officer, Rinac has set in motion the process of identifying new products to strengthen its portfolio. At the same time, it has initiated action to beef up its R&D (research and development) wing, comprising about 35 engineers from across disciplines.
In an interaction with this correspondent, he said the opening up of FDI in multi-brand retail would eventually drive the market towards infrastructure creation. “When big modern retailers come in, the chain itself will get developed, and the process then becomes irreversible,” he pointed out.
Elaborating the positive fall-outs, Mr. Krishnan said it would even open up opportunities for India to “look at food export”. Since there was no cold chain worth in place, the country could not export much of the milk items (except milk powder). Though Tamil Nadu was the largest banana-growing state with widest variety, lack of back-end infrastructure such as cold storage had constrained the farmers, he said.
In the wake of policy clearance for multi-brand retail FDI, he expected the focus to shift from dry logistics to wet logistics. In that scenario, cold storage would become an important constituent, he added. With big retailers going in for bulk sourcing of milk, fruits and vegetable and transporting them to consuming centres, the entire chain would require a well-positioned cold storage both at the back and front-end, he pointed out. He also felt that the country would see emergence of a host of organised aggregators. All these bode well for a company like Rinac which had a significant presence in verticals such as food preservation, healthcare and construction, he added.
