Birla Cotsyn, the flagship yarn-making entity of the Yash Birla Group, plans to foray into finished fabric products with a thrust on garment manufacturing.
The company will set up production facilities and enter into contract manufacturing. It will set up its own processing house with facilities such as ginning, spinning, weaving, yarn dyeing and processing at Rs 300-350 crore.
?We will add 36,000 spindles at the Malkapur cotton spinning unit at Rs 60 crore over 18 months. We have acquired land, common utilities and infrastructure at the site. Capacity at the unit is 36,000 spindles. The new processing unit at Malkapur for dyeing and finishing is to start commercial operations by September 2011 with a capacity of one million m per month,? Debashis Poddar, CEO, Birla Cotsyn, told FE.
The company plans to set up the entire value chain process such as ginning, spinning, weaving, yarn dying, final fabric and retailing under Birla Cotsyn brand.
He said additional capacity of 6,000 spindles would be created at Khamgaon spinning unit at Rs 10 crore with addition of one open-end cotton spinning machine at the unit at Rs one crore. The company will set up 1.50 mw wind mill for captive consumption in Maharashtra at Rs 9 crore.
Birla Cotsyn has three manufacturing units at two locations in the country. The synthetic unit at Khamgaon has a capacity of 300 tonnes and the cotton yarn unit at Malkapur has a capacity of 330 tonnes. The yarn major aims to increase the total capacity from1,000 to 1,200 tonnes of yarn per unit. It plans to see the Malkapur unit functional in 18 months.
?The investment for this segment could be around Rs 150 crore”, he said.
?Yes, we are looking into acquisition route too to hasten our growth plan. We may take over a garment manufacturing company or retail chain or retail brand depending on the situation,? he said adding the funds required would be raised through a mix of debt and equity.
Poddar said: ?Efforts are on to tap newer exports markets. Last year, the export turnover stood at Rs 840 crore. We have our own offices in London and Canada to cater exclusively to our marketing requrement.?
The company expects to clock a turnover of Rs 400 crore by March 2011 with a profit before tax (PBT) of Rs 16 crore. ?The company had a vision to achieve a turnover of Rs 1,000 crore by March 2015,? he added.
