The Hindu Business Line : Suryajyoti Spinning Mills to expand cotton yarn capacity

Suryajyoti Spinning Mills Ltd has initiated expansion and modernisation of its cotton yarn production capacities with the aim of expanding its presence in some key segments of the overseas market.

The company said it would add 32,256 spindles in two phases to be completed by the second half of 2006-07. Currently, the company operates 55,360 spindles across two units located at Makthal and Burgul in the Mahabubnagar district of Andhra Pradesh.

The project is likely to be completed in the first quarter of 2006-07 at a cost of Rs 28 crore, financed by debt (Rs 24 crore) and internal accruals (Rs 5.6 crore).

The total spindlage of the Makthal unit will increase to 29,232 from 22,172 leading to increased production of cotton yarn.

The next phase of expansion is being implemented at a total investment of Rs 47 crore to be financed by debt (Rs 35 crore) and internal accruals (Rs 12 crore). With this expansion, the company will add 25,200 spindles by putting its third new unit at Rajapur (Mahabubnagar).

"Post completion of the expansion initiatives, the total capacity will increase to 87,616 spindles," Mr A.K. Agarwal, Executive Director, Suryajyoti Spinning Mills, told Business Line.

The company also plans to set up a unit near Hyderabad to manufacture bottom weight fabrics. "The company is assessing the feasibility of this project that may also include a garment unit and would cost about Rs 100 crore," he said.

The company's yarn sale has increased to 148.67 lakh kg in 2005-06, up from 135.25 lakh kg in 2004-05. Capacity utilisation was 95 per cent in 2005-06. The company exported 1,866.87 tonnes of yarn during 2005-06 (786.83 tonnes). The products are exported mainly to Korea, Bangladesh, Hong Kong and Italy.

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