Banswara Textiles has reported a net income of Rs. 1,244 crores from operations during 2016-17. The company invested Rs. 67 crores in expanding capacity during the period. Its total production capacity as on March 31, 2017 for yarn production was 1,57,672 ring spindles, including 21,120 spindles for worsted yarn spinning, 592 air jet spindles, 436 shuttleless looms, 34 air jet jacquard looms, nine stenters with processing capacity of 5 million mtrs. per month and 3.81 lakh pieces of garments per month.
The core business of Banswara is manufacturing and marketing of spun synthetic blended yarn, wool and wool mix yarn, spun synthetic and worsted fabrics, and cotton & linen fabrics, besides readymade garments. The company also produces shirting and technical fabrics. Treves Banswara Private Ltd., a joint venture company, produces automotive fabrics. It has good scope for increase in demand, production and sale of its products.
Banswara’s future growth is built on two parallel growth drivers, viz., domestic consumption of fabrics & garments and large global opportunities in textiles & clothing. For the FY 2017-18, the estimated total revenue of the company is expected to be Rs. 1,300 crores, which is about 4.50% higher than the actual revenue for 2016-17. Banswara focuses on increasing sales of value-added products in yarn, fabric and readymade garments.
Almost 29% of Banswara’s yarn production is consumed in fabric manufacturing and 20% of its fabric production for its garment conversion. The company is looking for more avenues for forward integration and, as such, the availability of the material from the preceding stage is a big advantage.
Banswara produces all types of yarns and fabrics, i.e., polyester viscose lycra, dyed RFD, cotton piece dyed, linen, all wool and wool blends, etc. Thus, the company is a single source of supply of all these types of fabrics. It has flexibility to increase fabric production as per market demand.
Banswara has its own design studio and has developed a world-class range which is being displayed to the customers within and outside India. As there is a variety of fabrics available in its product line, the company anticipates deeper penetration in the domestic and international markets. It expects to increase the business with the new customers while retaining and strengthening the volumes with the existing clientele.
The world’s largest retailers like Zara and H&H have increased their market presence in India. They have now opened large-size stores in big cities. Banswara is a regular supplier to these brands for its international supply and therefore with the brands’ expansion in India, the company’s business with them for their Indian operation is likely to grow in a big way.
The US recently announced that it might exit the proposed Trans Pacific Partnership (TPP) Agreement wherein duty-free import was permitted from certain countries. India was not a part of this agreement, and therefore the other competing countries were expecting a competitive edge over India. Now, with the latest announcement by the US President, the Indian textile industry is likely to get an opportunity to step up exports to the US.