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Kitex Garments Ltd, manufacturers of high-grade garments for infants, proposes to invest ₹125 crore this fiscal to enhance production capacity and to upgrade technology.
The 100 per cent EoU has a production capacity of 5.5 lakh pieces per day at its unit in Kizhakkambalam in Ernakulam district. This will be increased to 1.1 million pieces by 2015-16.
The company plans to introduce robotic technology to meet the labour shortage, said Sabu M Jacob, Managing Director.
Out of the total investments, he said, ₹25 crore has been earmarked for upgrading sewing technology. The company has installed the longest bleaching machine in the world (62 metres), he told Business Line on the sidelines of the company’s annual general meeting.
Efforts are on to introduce the brand in the US and the company plans to invest another $10 million to develop distribution network and in the branding exercise, he added.
Despite the stiff competition, Jacob said international buyers have shown preference to Kitex Garments products for its quality and timely delivery. Major international buyers include Kohl’s, The Children’s Place, Gerber, Toys’R’Us, Carter’s, and Mothercare.
After capacity expansion, he said, the company hopes to cross ₹1,000-crore export turnover in the current financial year against ₹750 crore in the previous fiscal. When asked whether the slowdown in the US had affected business, he said, “the infant garments business is a recession-proof industry as parents do not compromise on products for the new born”.
He added that China’s prominence in the garment business is fast eroding due to high wages and low safety standards in the industry. Several apparel manufacturing units have now shifted operations to Vietnam and Bangladesh.
Earlier, 65 per cent of the garments exported to the US were from China. This has come down to 45 per cent. Though Cambodia, Vietnam and Bangladesh are strong competitors, he said that safety issues and lack of potential for scalability had minimised their opportunities.
This has provided India a good business opportunity to source a major chunk of the global garment manufacturing business.
Today, India exports 25-30 per cent of the textile goods to the global market, he said.
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