Rajapalayam Mills, a prominent player in the textile industry, has made significant strides in expanding its fabric unit and enhancing its production capabilities. With a robust strategy focusing on modernization, sustainability, and value-added products, the company is well-positioned to navigate market challenges and secure long-term growth. The company’s commitment to quality, innovation, and environmental stewardship has garnered attention from leading brands worldwide, positioning it as a key player in the global textile market.
Expansion of Fabric Unit:
During the fiscal year 2023-24, Rajapalayam Mills expanded its fabric unit by installing an additional 174 looms, bringing the total loom capacity to 328. The expansion, which commenced commercial production on September 1, 2023, also included the establishment of a fabric finishing facility capable of producing 50,000 meters of finished fabrics daily. The fabric unit’s production increased to 119 lakh meters, a notable rise from the previous year’s 96 lakh meters, while sales reached 122 lakh meters, up from 95 lakh meters the previous year. The total revenue generated by the fabric unit for FY 2023-24 amounted to Rs. 190.82 crores, reflecting the successful execution of the expansion project. The increase in volume is primarily attributed to the expanded loom capacity, with the export turnover for the fabric unit reaching Rs. 69.38 crores.
Resilient Export Performance:
Despite challenges posed by geopolitical factors and a sluggish market for cotton yarn, Rajapalayam Mills maintained its export performance with a value of Rs. 279.74 crores in FY 2023-24, compared to Rs. 325.99 crores the previous year. The company attributes this resilience to its focus on product enhancement through technological advancements, traceability, and customer-centric approaches. The company’s partnerships with global players like Asahi Kasei Advance Corporation, Doko Spinning Co. Ltd., and Unitika Ltd. of Japan have also played a crucial role in sustaining exports to Japan. Rajapalayam Mills’ emphasis on producing a flexible range of high-quality, value-added yarns such as Elitwist, Gassing, High Twist, Melange, Core Yarn, and Mercerized Yarn, helped it maintain sales volume even during market downturns. The sales volume of value-added yarns increased by 11% to 2,945 tonnes during FY 2023-24, up from 2,650 tonnes the previous year.
Strategic Modernization and Expansion:
The modernization and expansion initiatives undertaken by Rajapalayam Mills have positioned the company for sustained growth. The company completed the implementation of the loom expansion and the establishment of the fabric processing unit during FY 2023-24. The total investment for these projects amounted to Rs. 374 crores, funded through proceeds from the Rights Issue, internal accruals, and term loans from banks. This investment also includes Rs. 37 crores allocated for modernizing textile machinery, civil structures for the Mercerization plant, and enhancing electrical infrastructure with a 110KV sub-station. The successful completion of these projects has strengthened Rajapalayam Mills’ infrastructure, enabling it to produce a diverse range of high-quality products and meet the demands of global markets.
Future Prospects:
Looking ahead, Rajapalayam Mills is optimistic about its growth prospects. Despite volatility in cotton prices, the company is confident that global cotton production and consumption trends will support the demand for premium value-added products. The company’s ongoing efforts to strengthen its product lines with customized yarn counts and expand its value-added offerings are expected to mitigate the impact of fluctuating commodity demand. The synergies between the company’s spinning and fabric capacities are anticipated to drive top-line growth and protect margins in the coming years. Additionally, Rajapalayam Mills’ commitment to sustainable manufacturing practices, including the reuse of water, zero-liquid-discharge systems, and bio-treatment of wastewater, positions it among the top-rated textile companies globally. The company’s “A Grade” rating in Social Audit Compliances further reinforces its reputation, attracting leading domestic and international brands for sourcing yarn and fabric.
Rajapalayam Mills’ strategic focus on modernization, expansion, and sustainability underscores its commitment to long-term growth and industry leadership. With a robust infrastructure, innovative product lines, and a dedication to environmental stewardship, the company is poised to achieve sustained profitability and maintain its position as a key player in the global textile industry.
