How India's leading agro-commodity company doubled their portfolio in a year's time post-automation?

Olam Agro India Ltd is a wholly owned subsidiary of Singapore based Olam International Group. The company began operations in India in 1992, carrying out general origination and Raw Cashew Nut (RCN) trading from a single office in Mumbai. Within two decades, Olam India has become one of the leading commodity companies across the sub-continent, and enjoys a pan-India footprint for 10 key products.

Olam India enjoys a strong reputation of managing one of the most diversified agri-commodity supply chains in India.

Challenges

• Owing to their position, the company is exposed to significant foreign exchange and commodity price exposures.

• Key challenges faced by the treasury team at Olam India include:

• High dependency on spreadsheets and manual management of treasury processes

• Prone to manual errors while booking in the market

• Manual computation of MTM Rates

• Exposure underlying maintenance

• Validate trades with traders

• MIS Report preparation used to take more than 1 day

• Circulating business positions to each business users was done manually

• Compliance with Central Bank regulations on derivatives

• Adoption of hedge accounting to run hedge effectiveness test for derivatives

• Consolidation of positions – As all the processes were manual, this particular activity took hours, sometimes even days to consolidate.

Benefits

• IBSFintechʼs currency module saved Olam's time, money and energy.

• Initiation of the FX or the initiation of the risk towards linking it with your underlying exposure.

• The module offers real time reports/dashboards for managing open positions.

• Adhere to the groups dynamic hedging strategy.

• Implemented faster and has fulfilled Olam's requirement efficiently.

• Efficient end to end management: front, mid and back office.

• Multi currency capability (dollar, euro, pound, yen)

• They get access to real time mark-to-market

• After implementation they started doing currency and all related activities like derivatives, valuation, auto valuation.

Client Feedback:

Anil Jena, Head Treasury, Olam Agro India Ltd

"After analysing multiple alternatives in the market for our treasury front-office operations, we at OLAM India finally selected IBSFINtech which can be integrated at real-time. We perform extensive hedging activities and getting live market data has become a straightforward job owing to the integration of IBSFINtech's TMS with Thomson Reuter's DSS. We have been using TR's FXALL for all hedging activities and STP from FXALL to IBSFINtech TMS has been a boon to us. Post integration of FXALL and IBSFINtech TMS, we have been doing all the currency related activities like derivatives, valuation and auto valuation. Bottom line, we have added at least $1 Mn to our trading portfolio over the last one year of using this solution"