Established before India’s independence, Sutlej Textiles and Industries Ltd. (STIL) is one of the flagship companies of a multi-business conglomerate and is among the leading textile solution providers in India, manufacturing spun dyed and melange yarn on the one hand and home furnishing fabrics on the other. The company’s manufacturing units are located in Rajasthan, Jammu & Kashmir, Himachal Pradesh and Gujarat. Its aggregate spinning capacity was 4.21 lakh spindles as on March 31, 2019.
Sutlej exports products to more than 60 countries, enjoying a strong brand among prominent textile manufacturers in key markets like Turkey, Bangladesh, the US, Poland, Egypt, Italy, Portugal, Colombia, Africa, South Africa and Morocco. It is a one-stop solution provider for all kinds of cotton-blended, cotton-melange dyed yarn and spun-dyed yarn manufactured from natural or human-made fibres of any blend and any shade in the count range extending from 6s to 50s.
The company’s key clients include Jockey, Westside, Marks and Spencer, Arvind, Raymond, Donear NXG, Siyaram’s, Arrow, Aditya Birla Grasim, Digjam, JC Penney, Monte Carlo and Pantaloons, among others.
In addition to textile brands, the company has partnered leading fibre providers and market intermediaries. The reputed international brands that the company works with comprise Lenzing (Modal, Esfrom, Tencel), Invista (Cool max, Lycra) and Far Eastern Textile Ltd. (Low Phill PSF).
Sutlej’s aggregate sales increased by 4.09% to Rs. 2,589.36 crores in FY19, which compares favourably with the performance of the sector. Its sales by volume increased by 1.86% to 1,08,136 tonnes in FY19, creditable at a time of sectoral weakness. The company’s exports increased by 18.46% to Rs. 858.67 crores in FY19, which came at a time when the domestic market slowed. Exports as a proportion of revenue increased 4.02 bps to 18.46%.
New initiatives
At Sutlej, they believe that every slowdown represents an opportunity to make selective investments. During the course of this downturn, the company invested in a decisive backward integration comprising the setting up of the Rs. 189-crore green-fibre project (recycled polyester staple fibre) scheduled to be commissioned in the first quarter of 2020-21. Almost the entire production of the greenfibre plant will be captively consumed, which will reduce manufacturing costs, deliver consistent product quality and enhance the profitability of its yarn business.
Sutlej has also decided to invest around Rs. 80 crores to broaden product portfolio of its home fabric manufacturing facility and has also engaged specialized designers and senior marketing professionals. As a result of this shift in focus, the company believes that the home textiles business should turn around going forward.
Sutlej is indeed focused on the creation of new markets (yarn and home textiles) through the manufacture of innovative products, making it possible for the company to compete on quality, consistency and innovation (and not price alone). As a long-term initiative to enhance customer confidence, Sutlej’s manufacturing units were equipped with contemporary manufacturing technologies, experienced professionals, certifications (IS/ISO 9001:2008) and quality-testing equipment (HVI spectrum, AFIS Pro UT- 5, Tensojet and Classimat), among others. It was provided permission to use the ‘Usterised’ trademark by Uster Technologies AG, a rare honour.
Sutlej enjoys the recall of being a ‘peace of mind provider’ to customers on account of its products being compatible with modern downstream weaving machines of fabric manufacturers. The company has positioned itself as a one-stop solution provider by the virtue of its SKU range running into hundreds of yarn varieties and by strengthening its ability to provide any product, any quantity and any quality needs of fancy and specialized dyed to yarn buyers.
STIL grew yarn revenues 4.52% from Rs. 2,334 crores in 2017-18 to Rs. 2,440 crores. While the domestic market was sluggish, the company reported a 25.15% increase in yarn exports to Rs. 761 crores, standing for 31.18% of the company’s revenue. It grew yarn production 1.57%, from 99.80 million kg in 2017-18 to 101.37 million kg in 2018-19. Sutlej achieved capacity utilization of 94.29% (94.44% in the previous year), and commissioned 2,160 spindles, taking the total to 4,20,840.
Home Textiles
Sutlej Textiles made a synergic diversification in its business when it extended from the manufacture of specialized yarns to home textiles in 2006. The Home Textiles business extended from the functional to the pride-enhancing fashion segment. The market is beginning to evolve from large volume commodity manufacture to small batches of personalized design. The business has capitalized on the rich experience of American Silk Mills. The business provides large volumes to prominent textile brands.
The company brought to this business corresponding technology investments. It invested in cutting-edge equipment, state-of-the-art software, back-end testing laboratory, wide range (upholstery and curtains), fast-moving designs and collaborations with reputed European studios. Based on attractive traction, Sutlej trebled its manufacturing capacity in FY17. The home textiles business accounted for 4% of the company’s revenues.
Outlook
STIL intends to penetrate B and C Indian urban locations with a complement of new designs and finishes. The company believes that a wider product mix (printed and woven) will enhance the portfolio strength, customer interest and cross-selling. It soon expects to get the business towards break-even and subsequent profitability. To take advantage of the opportunities in this segment, the company is leveraging its presence in the US through its subsidiary, American Silk Mills (ASM). The US market has huge potential and has responded pretty well to the collection presented by the company and will add substantial value to exports turnover. Marketing efforts in the EU and UK markets have been strengthened by forging alliances with sales representatives and channel partners.
Opening up a liasoning office in the Middle East and hiring well experienced sales representatives for the Middle East as well as Far East markets will help boost the volumes in these markets going forward.
Combining of aesthetics with the product performance and its functional properties and strengthening the capabilities in finishing will help achieve a breakthrough into Contract / Institutional Channel. Sutlej has also started supplying to the Large Format Stores and Furniture manufacturers. These domestic sales channels have wide presence and offer excellent opportunities to drive sustainable volumes. Product portfolio in printed fabric as well as in wider width fabrics is being developed. This will lead to a widening of the product portfolio and offerings and enable the company to cater to the changing trends of the market. Functional Finishes (like easy clean, FR, back coating) which will help to cater to a wider customer portfolio (Contract / Hospitality) is being introduced.
Research and Development
STIL has well-equipped, most modern and state-of-the-art quality testing & development equipment, managed by committed team of highly qualified and experienced professionals. The company has latest technological equipment like Uster – 5 Evenness Tester, HVI Spectrum, Tenso Jet-4, Advance Fibre Information System, i.e., AFISPRO – LMNT, Classimat – 5 Yarn Fault Classifying System, Online monitoring system, Lab expert system all from Uster, Auto dispenser, Beaker Dyeing machines, Minolta Spectrophotometer, Vertical Package Sample Dying Plant, Devices to stop air leakage, Automatic Sortlink Bobbin Machine, Non Pressurised Solar Water Heating System, etc.
All the required tests on fibre, yarn and process material are being carried out. New varieties of yarn are being developed on a regular basis having different blends, shades, twists, etc. The division is ISO 9001-2015 certified and also possesses the Usterised, Oeko-Tex and GOTS/EKO & Organic Exchange Certificate.
Sutlej intends to install three Pulser Autoconer, two Uster Quantom Clearer, Polar Volufil Automatic Winder and one Uster Tester-5 evenness Tester, as also to install two knitting machines of different gauge, one desk loom and one fabric processing machine. New shade folders have already been made for the coming season, and the company will also develop a new range of sustainable products for the future. STIL has introduced goods designers in the Bhilwara and Mumbai market. Now the focus is on getting nomination business from known buying houses.
“We have set our sights on becoming a global textile front-runner, providing a wide spectrum of solutions to the textile industry, from speciality yarns to fabrics, thereby maximizing value for our clients and, in turn, becoming their preferred partner”
– C.S. Nopany, Executive Chairman, Sutlej Textiles