Kingsmen Investments started operating in Armenia in 2019 and in that short time, the company has become one of the investment sector forerunners in the region. While the company made its first moves in the real estate sector, today it is a major player in the agricultural sector as well.
In this interview, we ask Kingsmen CEO Angelo Hani what the benefits of investing in the agricultural sector in Armenia are. The interview also offers an interesting insight into the specifics of walnut farming.
Why invest in agriculture?
To begin with, the economic uncertainties and risks caused by the global pandemic brought forth unconventional inflation. Financial analysts expect that the recovery out of this situation won’t be typical either.
That’s why opting for safe investment options is now more crucial than ever. As such, agriculture is the safest sector out there. I always say this sector is a hedge against inflation when prices go hand in hand with inflation rates.
Why invest in the agricultural sector in Armenia?
Armenia offers many advantages when it comes to agriculture. First, land prices are incredibly low if we compare them with other countries, such as Romania, Ukraine, Spain, Italy, and the USA. Next, exporting is easy, and the country offers the most favorable tax environment in the region. Fact is, the taxes you pay to set up your orchards will be fully refunded by the government. The local wages are quite affordable as well and there is an unlimited water supply in Armenia.
Thanks to these reasons, the investment needed for walnut farming in Armenia is 50% cheaper than in any other country.
How do you choose the planting locations? What kind of studies are done?
4 major points are considered when choosing the planting location for walnut orchards:
- We opt for areas with well-drained soil as walnuts require climatic requirements similar to apples.
- We choose a variety of trees that are suitable for the weather conditions of the land location.
- We check the weather conditions of the area for the past 5 to 10 years.
- We provide soil tests in different locations of the land. A soil test commonly refers to the analysis of a soil sample to determine nutrient content, composition, and other characteristics, such as acidity or pH level. A soil test can determine the fertility of the land.
When to expect a return from investing?
Walnut growing business is a long-term investment, but if you have the means to wait for 5 to 6 years for the first crop of nuts to grow, the result is well worth it. I strongly believe that you will establish the best retirement plan ever by investing in walnut farming.
Let me give you a quick briefing about the return on investment from your orchard.
Imagine that at year 5, each hectare you plant will give you a return of 4,000 USD. At year 7, per hectare return will most probably double to 8,000 USD. At year 10, per hectare return will not be less than 10,000 USD. Thus, if your business case is based on a 50 Ha orchard, expect a total income of not less than 4,000,000 USD between years 5 and 10. This income will remain the same for 60 years to come and even more, so technically you are not only working on your retirement plan but ensuring a steady income for your family and for the generations to come.
What is your go-to-market strategy?
We are currently collaborating with another company. The scope of the cooperation includes developing shelling stations, where we’ll shell and package the crops to send to European markets.
How do you estimate the risk of loss?
Based on agronomical assumptions, walnut orchards can have a maximum of 5-10% loss, as some trees don’t grow. This is not a major risk factor since we replace these trees.
There are no other risks provided that the orchard is located in a perfect location, the water is easily accessible, and the weather conditions are good. The variety of walnut trees we grow are late bloomers, so hail damage is not a risk to consider. These trees also handle the cold much better than most other trees as they can withstand temperatures as low as -30⁰C.
Could you share the roadmap of where Kingsmen want to go in walnut farming?
Well, the big picture of what we want to achieve in collaboration with the well-known walnut growers in Armenia is to include the country on the world walnut map, so that the biggest players in the exporting field become interested in buying our products. A 5-minute scanning of our website will give you a hint that we are almost there.
Interested in investing in the agricultural sector in Armenia? At Kingsmen Investments, we have several investment options that ensure a high return on investment. We are ready to address all your concerns and guide you through your investment journey in Armenia. Check out our investment opportunities here or give us a call at (+374) 95 110 301. High return on investment guaranteed!