Inclusive Poultry Value Chain Project (ADB-53383-001)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Mar 27, 2020
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
Suguna Foods Private Limited
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Agriculture and Forestry
  • Technical Cooperation
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Advisory Services, Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 25.19 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 25.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Grant Amount (USD)
$ 0.19 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 50.50 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ ADB website

Updated in EWS May 22, 2022

Disclosed by Bank Mar 19, 2020

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to Asian Development Bank documents, the proposed project will support Suguna expansion across 13 identified states in India with the construction of 20 feed mills, four environment-controlled sheds for breeders, eight hatcheries, and various meat processing lines; and the expansion of the company contract farming program from 40,000 to 55,000 smallholder poultry farmers.

The Technical assistance (TA) will strengthen the capacity of women for engagement as contract poultry farmers. The TA will focus on building the farm management skills and financial literacy of 4,500 women contract farmers. The project will improve livelihoods and gender inclusion in rural areas, reduce malnutrition through the production of affordable proteins, and mitigate the impact of livestock farming on the environment and on climate change."

The outputs of the project are: (i) feed production capacity increased, (ii) poultry
farming capacity increased, (iii) poultry meat production capacity increased, (iv) the company has
become more gender-equitable, and (v) women farmers trained in poultry farming techniques and
financial literacy.

The project is ADB’s first assistance to an inclusive poultry business in India.

 

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

ADB will provide to Suguna a long-term senior secured corporate loan of up to
$25,000,000 equivalent in Indian rupees. The loan has a tenor of 7 years with a grace period of
2 years.

The proposed TA of $190,00028 which will be financed by ADB’s Technical Assistance
Special Fund (TASF-Others), will focus on training rural women in: (i) poultry farming's best
practices and (ii) functional financial literacy. T

Private Actor Relationship
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

Brothers Bangarusamy Soundararajan (current chairman) and Ganapathypalayam
Bangarusamy Sundararajan (current managing director) established Suguna in 1984.

Suguna is 99.65% owned by Suguna Holdings Private Limited (Suguna Holdings), which has subsidiaries in
Bangladesh, Kenya, India, and Sri Lanka. Suguna carries the group’s India business and is the
flagship company, contributing more than 95% (FY2019) to the group’s revenue. Suguna is
ultimately owned by the founders’ family through a trust, which owns 100% of Suguna Holdings.
While no formal shareholder agreement exists, the four children of the founders were appointed
as the beneficiaries of the trust through a written family governance deed.

Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

Suguna is India’s largest broiler enterprise, with an annual production volume of 1 million
t, turnover of about $1.3 billion (FY2019), and a broiler market share of 15%. Headquartered in
Coimbatore (Tamil Nadu), the company is present in 19 states (footnote 11), employs about 8,000
people (mostly in rural areas), and empowers more than 40,000 contract broiler farmers and more
than 200,000 corn and soybean farmers across rural India. Suguna is vertically integrated across
parent breeding, hatchery operations, feed mills, broiler farming, and meat processing.

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Suguna Foods Private Limited Client -

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Responsible ADB officer: Noorullah

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main

How it works

How it works