Envy Group’s Bengal Meat wants to come up in IPO to increase production

Staff Reporter: Envoy Group invested in Bengal Meet in 2011. At this time, it was decided to give priority to the local market as well as the export market by bringing the new and old directors in the share holding level. In this way, after almost a decade of journey to change the type of business, the company saw the face of profit.

Bengal Meat started its journey to export fresh, halal, healthy and quality ‘Safe Meat’. But due to lack of experience, lack of collateral to get loan facility, the price of meat in the local market is higher than the export price, the company has been calculating losses from the beginning.

In this situation, Envoy Group invested in Bengal Meet in 2011. At this time, it was decided to give priority to the local market as well as the export market by bringing the new and old directors in the share holding level. In this way, after almost a decade of journey to change the type of business, the company saw the face of profit.

Now Bengal Mitt’s goal is to create a good ‘balance sheet’ by maintaining this continuity and to list the company in the capital market to make the company sustainable.

Qutbuddin Ahmed, chairman of Bengal Meat, said, “We have already made a profit by overcoming losses before Kovid.” However, during the pandemic, it is still a bit down, but still continues to be in the trend of profit.

He said, “Dominating the local market, adding new products in line with market trends has brought our business to a stable level. At the same time it has built a reputation as a brand.

Mazharul Islam, an American expatriate, and his two friends started Bengal Meat in 2006 with the aim of exporting fresh, halal, healthy and quality ‘Safe Meat’. But due to lack of experience, lack of collateral to get loan facility, the price of meat in the local market is higher than the export price, the company has been calculating losses from the beginning.

Bengal then started producing wholesale meat for foreign buyers.

In order to survive, the company could not be stabilized by repeatedly issuing shares against the loan. Finally, after the investment of Envoy Group, Bengal Mitt returned to the trend of profit.

Envoy Group has over 40 businesses ranging from garments, textiles, real estate, and consumer goods. The industrial group has an annual turnover of মিল 400 million and about 21,000 employees.

After the acquisition of Envoy Group, several major policy changes were made in Bengal. The changes come in handy, Bengal Mitt is slowly seeing the face of profit. At present, 80 per cent of Bengal’s products are sold in the local market through 40 district-level outlets. And 20 percent of the products are exported to Dubai, Maldives and Kuwait.

Bengal Meat now produces and sells beef, mutton, chicken and other poultry (duck, pigeon, quail). The main products of steak meat, processed meat, ready-to-cook-marinated meat, frozen snacks, cold cuts as well as ordinary meat used for curry.

At present Bengal Meat is producing 400 tons of ‘Safe Meat’ every year, which is sold at home and abroad.

As part of the expansion, Bengal has started sourcing fish from farmers who are now working with Worldfish. The company is also working to increase the production and processing capacity of chickens soon.

According to Bengal officials, the production cost of safe meat is 10-15 percent higher than that of ordinary meat. But even then, considering the price of common meat in the market, ‘Safe Meat’ has to be kept within the reach of the buyer.

Push Cut out The way Turn around Stop Bengal Meet

Although it started its journey in 2008, Bengal Mitke had to face many difficulties. In the beginning, most of the money was spent on the technical development of the company. The company could not export the goods as per the target due to lack of collateral, processing of goods in accordance with foreign standards but due to various complications in the export.

However, entrepreneur Mazharul Islam did not give up. Bring in potential buyers from Malaysia, Dubai and other countries to show them how the meat is being processed. While the company was making losses, he hired foreign experts to maintain the quality of meat processing.

After 2014, some of the entrepreneurs left Bengal Meet. But even then Mazharul Islam did not compromise with the standard. Instead, he started looking for new investors.

Mazharul finally got a new investor. Halal certificate has been obtained from Indonesia. Now the new investors are taking care of the company.

Bengal Mitter To the flesh ‘Safe Meet ‘ To say Because

Bengal Meat officials said their animals were kept in a stress-free environment to ensure ‘safe meat’. For this, wherever there is an animal, it has to be reared and processed. The key to this process is, ‘Carry the meat, not the animal’. That means only meat can be transferred, not animals. Because any change in travel and environment puts pressure on the animal. This produces lactic acid in the animal’s body, which affects the meaning of the meat.

AFM Asif, Chief Executive Officer (CEO) of Bengal Meat, said, “Bengal Meat was started only for export purposes. That is why the processing unit is made to that standard. Where the quality is controlled from collecting cows to selling meat.

He said that in the initial stage, it is seen whether there is any external disease in the animal. The animal is then hung after slaughter. The meat cut begins only after the veterinarian examines and gives clearance after hanging. The price of cattle is given to the supplier only after passing the examination of veterinarians.

Bengal does some work in the control environment, including reducing stress and disinfection. At this time the animal is kept in the chilling area at a temperature of 5 degrees Celsius. After that, when the butchers work, the ambient temperature should not exceed 12 degrees Celsius.

After slaughtering, the meat is disinfected, processed and marketed. This is why factories and outlets always maintain a certain temperature so that the nutrients in the meat remain intact.

Asif said farmers are now very much aware of quality and hygiene. ‘They trust us.’ He also said that many young entrepreneurs are keeping cows in the belief that Bengal Meat will take cows all year round.

Of meat Power

The founding entrepreneurs of Bengal chose Pabna region, which is famous for raising cattle, for setting up factories. Apart from setting up a processing unit there, only high quality grass production and research is being carried out on 30 acres of land.

Bengal Meat used to collect cows through traders in the beginning. They used to go from house to house and bring cows. But now the grassroots farmers contact the organization and go with the cows at regular intervals.

The company now has more than 1,000 farms in its supply chain. Throughout the year, they supply about half of the demand for Bengal meat. And Bengal Meat always has 500 to 1000 cows in its own farm.

Bengal CEO Asif said, “Farmers know we will not pay more, but we will pay the minimum profit and it is guaranteed. Suddenly the market has increased abnormally, we do not pay that money. The market has fallen again, we do not take into account. I do casting in such a way that the profit of the farm is there. Because I always take cows from him, so I am by their side. ‘

Once upon a time there was a lot of work to be done for the selection of cows but now that task has become much easier. Because all those who supply cows are trained by Bengal Meat. They keep cows as per the instructions of the organization.

Farmers, financial institutions IPDC and Bengal Meat have also entered into a tripartite agreement to assist farmers and increase their own production capacity. Through this agreement, the farmers get a loan from IPDC and Bengal Meat acts as a guarantor to repay the loan.

Asif said, ‘Even relying on us, many farms are being built now. Because a place of faith has been created here. We don’t have to worry about the transaction.

He said his company’s research and development branch was researching six airborne diseases in animals.

Bengal Meat has a paid up capital of Tk 118 crore but at present its equity investment is around Tk 250 crore. In all, about 800 people are now employed in Bengal, officials said.

Bengal Meet What? Only The elite For?

When Bengal focuses on the local market, it targets five-star hotels. These hotels used to import red meat. Bengal meat became an alternative to that import. Many hotels now take meat from them.

But Asif said it was still challenging to increase customer base at the grassroots level due to retail prices.

“Not everyone wants to pay for the extra cost of producing safe meat, when they see that meat is available at a lower price of Rs 70-80 next to the house,” he said. Asif also said that the cost of cold-chain maintenance is much higher.

To overcome this hurdle, Bengal Meat has entered into an agreement with Bangladesh University of Engineering and Technology (BUET) to bring technological development at affordable cost.

Bengal Mitt also said that it is facing many policy hurdles. When it comes to borrowing from banks, they are seen as processors, not farms. As a result, they are paid interest as processors, not as farmers. But Bengal Meat claims the organization is an expanded version of grassroots farming.

Another problem for Bengal is the Indian buffalo meat that is being marketed in the name of beef. This meat is cheaper than beef and its main buyers are restaurants.

If Indian cattle do not stop coming and cattle rearing is reduced, it will have a negative impact on the whole industry. For this reason, Bengal Meat has demanded to tighten the import of frozen buffalo.

Asif said, “Bengal still survives as shareholders and financiers are emotionally involved. Otherwise, they would have left long ago due to food security costs.


Source: Daily StockBangladesh by www.dailystockbangladesh.com.

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