Sangam (India), a leading polyester-viscose dyed yarn manufacturer, has announced completion of its Rs. 180-crore expansion project to double its denim capacity to 32 million metres, following the commissioning of its second denim line of 8 metres.
As a part of the expansion plan, the company has set up two lines of denim for 8 million each. The first line commenced production in November 2011, while the second line was commissioned very recently. The company has installed 2,304 rotters for open-ended spinning along with 3,000 mtpa knitting capacity and 7,200 mtpa texturizing yarn capacity at its existing facilities at Bhilwara in Rajasthan. The company has also modernised its processing division by replacing new processing machines.
The Rs. 180-crore expansion project was financed through a mix term loan and internal accruals.
Commenting on the development, Mr. R.P. Soni, Chairman, Sangam (India), said: “With the completion of this expansion project, we plan to launch special fancy denim and enter high value-added products like cotton lycra, which offer better realisation and have a high demand. Going forward, the new capacity expansion will help the company to generate additional revenues in excess of Rs. 300 crores annually.”
Financial performance
For the financial year ended March 31, 2012, Sangam registered a 20.97 per cent rise in net sales at Rs. 1,417.22 crores compared to Rs. 1,171.52 crores in the previous year ended March 31, 2011. Net profit stood at Rs. 17.08 crores (Rs. 56.59 crores). Export revenue has increased by 21 per cent to Rs. 308.22 crores.
Commenting on the company’s financial performance, Mr. Soni said: “In spite of challenges in the industry on account of high volatility in cotton prices and currency fluctuations, we have managed to post performance much better than the other players in this segment. Once the market stabilises, we hope to deliver better performance in the coming quarters.”
Meanwhile, the company’s Board of Director has recommended a dividend of 10 per cent (Re 1 per share) for the equity shareholders.
Promoted by first-generation entrepreneurs, Mr. R.P. Soni and Mr. S.N. Modani, Sangam (India) is one of the largest manufacturers of polyester viscose dyed yarn in the country. At present, it has 1,62,720 spindles of polyester-viscose dyed yarn and 31,200 spindles for cotton yarn installed in Bhilwara, along with 257 weaving machines and a 31 mw thermal power plant.
The company also has its strong presence in the Indian synthetic blended fabric segment with brands like Sangam and Anmol. The company has an established client base, like Reliance, Reid & Taylor, Siyaram and Grasim. Its fabric is marketed through a network of 200 plus dealers and thousands of retailers.