Indus Fila acquires 51% in Indus Garments

Company to enter retail market this fiscal.

Bangalore-based textiles and apparel maker Indus Fila Ltd has acquired a 51 per cent stake in Indus Garments (India) Ltd for Rs 9.3 crore. The Rs 273-crore company is a part of the Indus Mandhana Enterprise. The acquisition of Indus Garments was funded through internal accruals.

Last year, Indus Fila acquired the fabric division of Sai Lakshmi Industries for Rs 90 crore. Indus Garments is an apparel manufacturer with 96 per cent of its products being exported to American and European customers. The turnover of the company for FY07 was Rs 90 crore. The installed capacity of the company is 3.6 million garments per annum.

"Looking at the present market and the business trend, we decided to join hands with Indus Fila, a fully-integrated textile apparel company. This move will give both companies a competitive edge and the synergy of each other's experiences and relationships in the marketplace," Vivek Kumar, managing director of Indus Garment (India) Ltd said. "This is a perfect forward integration and an excellent joint venture for both of us." managing director and vice-chairman Vivek Mandhana said.

Indus Fila completed its initial public offer of Rs 82.3 crore in March 2007.

The company has already started work on a design bureau to cater to the needs of its international clients. The company is also planning to enter the retail market. "We might tie up with a big retailer or create our own format, but we will definitely start retailing by the end of this fiscal," Mandhana said.

The company also said they are on the lookout to buy an international apparel brand for around Rs 400 crore.

Indus Fila has been supplying ready-to-wear apparel to international brands such as Mexx, Armani, Levi's, Nike, Tommy Hilfiger, Philip Van Heusen, Haggar and Wal-Mart.

It also supplies fabric to local garment producers. By the end of the present fiscal, the company claims its capacity will go up to 42,000 pieces a day.