Nakoda to invest Rs 1935 cr in capacity expansion

Having bagged the approval of its board of directors, Nakoda Limited has decided to invest Rs 1935 crore for expanding its POY and FDY manufacturing capacity at its plant in Gujarat.

As part of the capacity expansion at a new location, the company will set up a 2,80,000 MTPA plant comprising of continuous polymerisation, direct melt spinning for the manufacture of POY and FDY.

According to an official statement, the POY and FDY will be manufactured in the denier range of 30 to 500 having 12 to 578 filaments in bright, semi-dull, full-dull, cationic and dope-dyed yarns. While the project is all set to be the first fully automatic plant in India, it will also be the only fully integrated polyester filament yarn plant in the country.

The announcement was the outcome of the recent meeting held on 5 January 2012, whereby the board of directors, approved expansion plans to significantly enhance capacities and produce specialty yarns. After completion of the expansion project, Nakoda will be in a position to cater to the entire range of polyester yarns in the domestic as well as international market.

Further, the investment of Rs 1935 crore for the expansion project is proposed to be financed by a mix of equity and internal resources and also the long terms debts. The required equity for the same is already raised partly through GDRs and partly through preferential allotments to the promoters and strategic investors.

Post the expansion, the unit will be equipped with state-of-the art R&D facilities to develop specialty yarns that cannot be afforded by small and medium units. Moreover, about 50 per cent of the production is to be captively utilised at Surat Super Yarn Park Ltd. (SSYPL) located in vicinity of the project. After expansion about 100 per cent of coal-based captive power generation will assure uninterrupted quality power supply at much cheaper rates.

The company also plans to capitalise on significant savings in the packaging cost by elimination of cartons for the material to be supplied to SSYPL. Also similar savings in the cost of certain inventories like spools, caps, pallets and some other goods are to be undertaken.