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G. Srinivasan

Company entering into individual home segment

New Delhi , Nov. 6

The Rs 600-crore Shri Lakshmi Cotsyn Ltd is bucking the general trend of the textile industry by moving from synthetics to cotton, taking advantage of the growth opportunities, both domestic and foreign, afforded by the natural fibre.

Disclosing this to Business Line here, the Chairman and Managing Director of the Kanpur-based Shri Lakshmi Cotsyn Ltd, Mr M.P. Agarwal, said after mastering into technical textile fabrics for industrial and institutional segments, the company is entering the individual home segment with terry towels, home furnishing, denim fabrics, garments and bottom weight fabrics.

He said his company has capacity to produce 3,000 tonnes per annum of 100 per cent cotton terry towels.

The company has undertaken a Rs 264-crore expansion programme recently and commercial production would begin from the expanded capacity by December in all product portfolios such as denim, bottom weight fabrics, bed-sheets and terry towels. The company is putting a 1,500-tonne-yarn processing plant for captive consumption.

Mr Agarwal said the first quarter results (July-September) of 2006 were announced at the company's board meeting held here on October 30. Against Rs 81.92 crore sales of 2005 first quarter, the company's sales during the current year's first quarter grew 20 per cent to Rs 98.52 crore, exports by 17 per cent and profit after tax to Rs 5.10 crore (Rs 4.02 crore). He said the company's turnover in fiscal year ending June 30, 2006 touched Rs 360 crore.

He said with the completion of the expansion plan expected soon, commercial operations from January to June 2007 would add Rs 200 crore to the total turnover, taking the overall turnover to Rs 600 crore by end-June 2007. He said the objective is to take this turnover to Rs 800 crore in 2007-08 and to Rs 1,000 crore by 2008-09.

Mr Agarwal said though annual exports have been accounting for Rs 50 crore now, it would be progressively stepped up to Rs 500 crore by 2009, as efforts were on to tie up with major retail chains abroad such as Wal-Mart in the US for terry towel and other cotton-based textile products the company is manufacturing now. He said the focus is on the major markets of the US, Europe, and the UAE.

Bullish on exports

Explaining his optimism on the export front, Mr Agarwal said his manufacturing unit is producing microdot fusible interlining, fusing fabric for shirt collars, cuffs, belt tolls and plackets. He said the interlining is produced in different sizes to meet the customers' standards and is 100 per cent shrink-poof and showing good bonding and dimensional stability.

He said as India's share is around 3 per cent in terry towels and 8 per cent in denim in global trade, his company sees immense growth potentials in the export markets.

Currently, the company enjoys a domestic distribution network of 300 agents across the country for domestic sales, besides supplying defence-related items such as bullet-proof jackets and bullet-proof helmets to defence establishments.

Once the company's nylon plant and garmenting unit in Roorke also goes on stream, Mr Agarwal is confident of supplying his textile products to domestic retail chains too as they are also getting spruced up.

More Stories on : Outlook | Strategy | Textiles

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