Banswara shifts focus to fabrics
Banswara Syntex is now putting more premium on businesses of fabrics and garments even as there has been no rethink in its strategy vis-à-vis yarn.
By Mithun Roy, ET Bureau |
MUMBAI: Banswara Syntex���s (BSL) focus has clearly undergone a change. The firm, which owns the country���s largest single-location integrated textile mill, is now putting more premium on businesses of fabrics and garments even as there has been no rethink in its strategy vis-��-vis yarn. The intense competition from low-cost yarn-making countries like Bangladesh and Pakistan seems to have triggered the move.
Banswara Syntex joint managing director Ravi Toshniwal said: ���We have increased concentration on value-added products like fabrics and garments while keeping our core competence in yarn intact.��� The company targets 60% revenue from garments and fabrics combine this fiscal, he added.
Another reason why BSL has rejigged its action plan, according to a textile analyst, is higher margin in value-added businesses. The garment business fetches margins as high as 22-25% compared to only 8% in yarn. The margins in the fabric business are 14-18%. The company has set up a garment plant at Surat SEZ to produce trousers, jackets and suits. With this, the garment capacity has gone up from 75,000 units a month to 2,50,000 units. Similarly, spindles have seen a capacity ramp-up from 92,032 to 1,60,000 and the company���s looms have gone up from 143 to 207.
BSL has a strong customer base in both domestic and international markets. Its clientele includes leading international players like Levi���s Strauss (Dockers), Marks & Spencer, Next, Perry Ellis, Liz Claiborne and domestic players like Raymonds, Pantaloon, Grasim and Westside. The company���s plants are located at Banswara in Rajasthan and Daman in Gujarat. It has also set up an 18-mw thermal power plant. The vertically integrated textile company recorded 69% decline in net profit at Rs 4.4 crore last year. Net sales rose 15% to Rs 438 crore.
India is the world���s third-largest producer of cotton and second-largest producer of cotton yarn and textiles, where garment sector is one of the fastest-growing industries.
In garment manufacturing space, small-scale fabricators dominate and the bulk of apparel is produced by about 77,000 small-scale units classified as domestic manufacturers, manufacturer exporters and fabricators. The fragmented structure of the industry provides the advantage of a large pool of skilled workers in different areas of textile manufacturing and also offers scope for entry of organised integrated textile manufacturers.
Banswara Syntex joint managing director Ravi Toshniwal said: ���We have increased concentration on value-added products like fabrics and garments while keeping our core competence in yarn intact.��� The company targets 60% revenue from garments and fabrics combine this fiscal, he added.
Another reason why BSL has rejigged its action plan, according to a textile analyst, is higher margin in value-added businesses. The garment business fetches margins as high as 22-25% compared to only 8% in yarn. The margins in the fabric business are 14-18%. The company has set up a garment plant at Surat SEZ to produce trousers, jackets and suits. With this, the garment capacity has gone up from 75,000 units a month to 2,50,000 units. Similarly, spindles have seen a capacity ramp-up from 92,032 to 1,60,000 and the company���s looms have gone up from 143 to 207.
BSL has a strong customer base in both domestic and international markets. Its clientele includes leading international players like Levi���s Strauss (Dockers), Marks & Spencer, Next, Perry Ellis, Liz Claiborne and domestic players like Raymonds, Pantaloon, Grasim and Westside. The company���s plants are located at Banswara in Rajasthan and Daman in Gujarat. It has also set up an 18-mw thermal power plant. The vertically integrated textile company recorded 69% decline in net profit at Rs 4.4 crore last year. Net sales rose 15% to Rs 438 crore.
India is the world���s third-largest producer of cotton and second-largest producer of cotton yarn and textiles, where garment sector is one of the fastest-growing industries.
In garment manufacturing space, small-scale fabricators dominate and the bulk of apparel is produced by about 77,000 small-scale units classified as domestic manufacturers, manufacturer exporters and fabricators. The fragmented structure of the industry provides the advantage of a large pool of skilled workers in different areas of textile manufacturing and also offers scope for entry of organised integrated textile manufacturers.
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