TT Ltd. clocked a turnover of Rs. 503 crores during 2012-13, an increase of 28 per cent over the previous year. The company earned PAT of Rs. 6.55 crores against a loss of Rs. 2.17 crores in the previous year. The company managed this turnaround despite poor domestic and global market, with its aggressive marketing of yarn in China, strong marketing push of its branded knitwear in the domestic market/Middle East and product expansion in the value-added knitwear segment. It was supported by the range bound cotton prices for most of the year.
TT Ltd. is now selling in 62 countries and is striving explore new markets. The company has completed all its ongoing expansion projects. The new 25,200-spindle spinning mill at Rajula in Gujarat was completed in April last. It has now started commercial production. This unit would be able to avail of the various incentives provided in the Gujarat Textile Policy, 2012.
Apart from electricity rebate and VAT exemption, the biggest benefit would be the seven per cent interest subsidy, which the project would enjoy for the next five years (over and above the four per cent interest subsidy under TUFS). This unit, buoyed by the attractive State policy and the locational advantage (next to cotton growing areas and port), is expected to be the most profitable one among the company units.
The company is also going for state-of-the-art automation systems to reduce the labour requirement in view of the increasing wage levels and widespread labour shortage.
Over the last few years, TT Ltd. has been working towards improving its contribution of domestic sales and also the percentage of value-added branded knitwear business. The share of domestic sales has increased to 45 per cent from 20 per cent a few years back. Similarly the share of the knitwear segment has gone up to 20 per cent from 10 per cent. The company hopes to improve the percentage to 50 and 25 respectively in two years.
In order to strengthen its branded value-added domestic business, the company has adopted a new slogan – “Zindagi is Good” to align itself with the changing consumer preferences. It has also introduced and expanded its range of products for men, woman and kids.
The removal of excise duty on garments in the Union Budget has further improved the prospects of growth and margin expansion in this segment. It expects a growth of 25 per cent for its branded knitwear segment, as also margin expansion. The company sees immense potential in the new distribution channels like institutional selling, and e-commerce and is now focusing on these channels in a big way.
TT Ltd. feels the worst is over and the company has managed to cover up the setback of 2011-12. The depreciating rupee, and reasonable cotton prices have created a favourable situation for cotton yarn. Further the expected good monsoons, lower inflation and the removal of excise could boost domestic garments demand. “However with global growth still muted, political uncertainty and volatility in all areas – it’s difficult to predict precisely how well the company would do in 2013-14. However, we are confident that it would be better than the last year”, says Mr. R.C. Jain, Chairman, TT Ltd.
TT Ltd. intends to install solar power plants offline for localized captive consumption within each spinning mill. Mr. Jain says: “We hope by 2016 all our mills and manufacturing units will be running 100% on clean solar/wind power energy. This move is to promote eco-sustainability and will certainly be our bit of effort to “save earth”. Our operations in Tamil Nadu already have 100% captive wind power”.
The company is also focusing on environmental-friendly yarns like organic, BCI, Fair Trade certified.