Massive capacity expansion underway
Suryalaksmi Cotton Mills is among the country’s leading original denim manufacturers producing cotton, polyester and blended yarns at its spinning division at Amanagallu in Mahabubnagar district, Telangana, denim fabric at its Denim Division at Nagardhan village in Maharashtra and garments at its Garment Division in Thummaluru, near Hyderabad. The company also has a captive power plant at Ramtek in Maharashtra.
“We have recorded Rs. 71,434 lakhs of income from operations with a PAT of Rs. 1,216.81 lakhs in 2014-15. The garment and fabric division recorded sales in line with the previous year. We successfully entered new geographies like France, Madagascar, Turkey, Kenya, South Korea and Portugal, among others. This positive movement has enthralled and infused us with even greater determination to increase export levels in the coming months. The current situation is only expected to get better in the coming months,” said Mr. L.N. Agarwal, Chairman & Managing Director, Suryalakshmi Cotton Mills.
Today, Suryalakshmi is among India’s leading polyester and blended yarn manufacturers with more than 61,000 spindles to its credit. With production facilities across two units, the yarn division has been the value driver for the company over the years. With its focus on producing value-added yarn, the company expects to increase production capacity with its new facility to be set up at Rs. 131 crores at MIDC in the Amravati district of Maharashtra. The unit will manufacture value-added and fancy yarns such as ring, slub and compact. The facility will be supported by state-of-the-art machines such as AmslerSlub attachment from Switzerland, Core yarn attachment from Pinter, Spain, and Eli Twist Compact from Suessen, Germany.
These state-of-the-art technologies will provide the company a significant edge in producing value-added yarn, further integrated and processed to produce value-added denim fabric, meeting the demands of today’s evolving fashion industry.
The company hopes to commission the new facility by the end of September. This is expected to result in enhanced revenues for the second half of FY2015-16. The company produced 18.7 million kg of yarn, with a 94 per cent capacity utilisation.
Denim
With almost two decades in the field, Suryalakshmi is today the third largest single-site denim fabric manufacturer in India. The unit is vertically integrated, allowing the company to develop a varied product-mix, in line with the evolving trends.
Exports to global clients, backed by machineries and technology from some of the best in the world, are among its core strength. The company replaced 56 old Airjet looms with new Toyota Airjet looms in the last three years corresponding to superior operational speed, value-added products and higher production per loom. Currently Suryalakshmi has manufacturing capacity of 40 million metres of denim fabric.
Road ahead
Looking at the road ahead, the company expects to stretch its trail by focussing and enhancing the range of its value-added products. Development of a consumer-centric denim value chain will also help create avenues that unleash the great potential inherent to India’s denim market. The increasing awareness of sustainable fashion provides an additional opportunity to promote denim as a product of natural cotton fibre. This is perceived as more eco-friendly compared to synthetics. The value share of the denim market is skewed in favour of mega metros. These account for almost half of the total denim market.
Denim apparel production in India remains a fragmented industry where only 20-30 per cent of denim apparel is manufactured in the organised units. This is expected to change in the coming years, with the organised sector and brands expected to play a bigger role.
Garments
With its special focus on forward integration, the company derives additional revenue through its garment division. With a higher proportion of fabric production, it has strategically built on its strength to produce quality garments.
Suryalakshmi produces garments for some of the leading global brands in the world, collaborating right from design to finished product. The company produced 1.07 million garments annually (89% capacity utilisation). The division has a decent revenue visibility with a healthy order book for the coming year.
Exports
Suryalakshmi has increased its exposure to key clients such as Wrangler, Lee, JC Penney, UFO etc., in the US and Canada markets. It has introduced an array of unique shades and interesting performance-oriented new fabrics like Cool Max, Dual Core, Bamboo, etc., which have been well received by the markets.
In addition, its new dobby design has been a great success with the international customers. Last year, the company ventured into new markets like Korea, South Africa (Madagascar, Durban, Mauritius and Lesotho), South America (Peru, Colombia and Chile), Turkey, etc. As part of these exercises, it has participated in important exhibitions like Munich Fair in Germany, Bangladesh EXPO and Colombia Tex. This has given Suryalakshmi Cotton Mills the required exposure across the globe.
“We are confident that our strategic steps will enable us to emerge a Rs. 1,000-crore revenue company in a couple of years. We endeavour to touch the lives of millions of people through our product chain and hence redefine the future of denim wear in India and globally”, added Mr. Agarwal.
