The Hindu Business Line : Sintex investing Rs 150 cr for expanding business

Ahmedabad, Dec. 29 Plastics products major Sintex Industries Ltd plans to invest Rs 150 crore in its textile business and diversify into garmenting and hosiery for export market, company sources said.

The company is planning to enter female shirting and hosiery next year.

“By October 2008, we would enter garmenting mainly for our exports business to cater to our customers abroad through our subsidiaries in the US and Italy,” a senior company official told Business Line.

The company is sourcing designs for textile business from the UK and Italy and its entire production would be pre-sold. Its textile division based at the Kalol complex in North Gujarat has achieved 19.5 million metres per annum of production, against the current capacity of 21 million metres. This has necessitated capacity expansion to 24 million metres in 2008 and 29 million metres in 2009.

For this expansion, Sintex is investing Rs 120 crore in the next two years, apart from Rs 25 crore in garmenting.

The company exported five million metres of textiles in 2006-07 which is likely to reach up to 7.9 million metres this year. Sintex is also going for fabric for curtains, cotton linen etc. These would be sold by April 2008 under the company’s original brand of Bharat Vijay Mills.

Revenue generators

Plastics business of Sintex, well-known for its water tanks, now contributes only seven per cent of the total turnover of about Rs 1,100 crore per annum. The company’s textile segment contributes about 28 per cent of revenues.

It has also diversified into composites, which contributes about 35 per cent of revenues, and pre-fabricated building and construction material accounting for the balance. The Gujarat-based company had acquired US-based Wasaukee Composites for $245 million, Europe-based Nief Plastics, Indian company Zepplin Mobiles, and the automobile division of another Indian company Bright Brothers.

Next year, it plans to acquire another three companies abroad through its foreign arm, Sintex BV, headquartered in Holland, for about $150 million.

Besides, Sintex is set to invest Rs 600 crore in the next three years for expansion of its key businesses and building capacities.

More Stories on : Diversification | Plastics | Readymade Garments

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