The Hindu Business Line : Sybly Ind: Active on expansion plans

Sybly Industries is on `activity street' once again having spun out its second phase of expansion plan, according to market sources. The stock moved up by around five per cent on Friday to close at Rs 16.20 with 33,174 shares changing hands on the BSE. In the last one month, the counter has moved up by over 23 per cent.

Mr Mahesh Mittal, CMD of the company, clarified to Business Line that work has indeed started for the second phase of capacity expansion. The Rs 25-crore plan would take the yarn manufacturing capacity to 4,000 tonne per annum by March 31, 2007 from the current 3,500 tpa, and 6,000 tpa by the end of 2007-08 fiscal.

The company has planned to raise funds through debt and equity approximately at a ratio of 50:50. "We hope to finalise the fund raising mode by the end of this fiscal", he added.

Mr Mittal, however, said that the diversification project through the company's 100 per cent subsidiary, Vartex Fabrics, would be looked at in the later part of the next fiscal. In March, Vartex had bought 3.5 acres of land near Ghaziabad in Uttar Pradesh at a cost of Rs 2 crore.

It is expected that sales and profit of the company would show improvement in the coming quarters. The September quarter results (to be announced at the end of this month) might show a sales growth of around 25 per cent, market sources anticipated. Mr Mittal, without giving any numbers, indicated that the current order book position of the company was decent at Rs 3 crore (roughly five months' sales). "Margin growth is also noticeable", he admitted.

Interestingly, the expansion plan-driven fund raising has dramatically reduced the promoters' holding in the company. It has come down to 24.08 per cent of the expanded paid-up capital from 54.41 per cent as on March 31, 2005. Public holding has, however, gone up to 25.63 per cent from 16.44 per cent. Around 15 lakh warrants issued last year (with a deadline ending February 2007) are yet to be converted into equity.

Jayanta Mallick

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