Kanpur-based Shri Lakshmi Cotsyn Limited (SLCL) is an integrated textile player. It posted net sales of Rs 1,798 crore for the year ended June 30, 2011 and expects its turnover to touch Rs 5,000 crore in the next three years. The company has lined up investments to the tune of over Rs 5,000 crore in Uttar Pradesh and other states in textile and power sectors. In a n interaction with Virendra Singh Rawat, SLCL chairman and managing director M P Agarwal fields questions related to the sector. Excerpts:
Textile sector has been facing some tough times lately due to several reasons. Your comment.
Yes, textile sector has been facing some tough times recently due to various reasons such as volatile raw material costs particularly cotton yarn, increase in power and fuel cost, rising interest cost etc. Besides, textile industry is facing competition from China, Pakistan and Bangladesh.
However, Indian textile industry is doing fairly well as it is one of the world’s largest producers of natural and manmade fibres and contributes four per cent to the country’s Gross Domestic Product (GDP). It provides employment to 35 million people, second only to the agriculture.
What the factors contributing to the growth of textile sector?
The various growth drivers of the textile industry are increasing discretionary income, growth in retail, increase in working population, changing consumer choices and government support, such as Technology Up-gradation Fund Scheme (TUFS), Scheme for Integrated Textile Park (SITP), Integrated Skill Development Scheme (ISDS), Duty abatement (reducing central excise duties from 55 per cent to 40 per cent) and Foreign Direct Investment (FDI), under which 100 per cent investment has been allowed via automatic route.
How is the UP textile sector standing up to growing competition from national and international players?
The textile industry in UP is performing fairly well because of the geographical situation and the availability of low cost skilled-labour.
Give a brief overview of your company and the guidance for near future?
Shri Lakshmi Cotsyn is an integrated textile player and amongst India’s top 10 textile manufacturers. It has a rich product portfolio with internationally benchmarked quality standards. Our portfolio of innovative and eco-friendly products include vitamin E enriched bed sheets, zippers, home textiles, ready-made garments, and technical textiles. We have captive textile auxiliary chemical plant and in-house research and development mechanism.
We clocked net sales of Rs 1,798 crore for the year ended June 30, 2011 compared to Rs 1,535 crore last year. We are expecting to achieve a turnover of over Rs 5,000 crore in next 3 years.
How much does the technical textiles segment contributes to your business?
Technical textiles, which include defence/safety textiles contribute 30 per cent to our top line.
What are the future plans for UP or other states?
We are setting up a project estimated at Rs 992 crore at Fatehpur district of UP for technical textiles, denim & sheeting. Another spinning unit with 2,00,000 spindles and 10,000 rotors has also been planned at Fatehpur with a project cost of Rs 500 crore, besides another polymer project of Rs 1,500 crore. In Kanpur, we are setting up a textile park with a project cost of Rs 135 crore. Meanwhile, the company is planning to set up 300 Mw thermal power project in Chhattisgarh with project cost of Rs 1,800 crore and 5 Mw solar power project in Rajasthan with the project cost of Rs 90 crore.
What are your expectations from the state and central governments for the betterment of industry in general, and textiles industry in particular?
We want superior infrastructure in UP and grant of subsidy to promote industries. There should be control/reduction in power and fuel prices, rate of interest and control on cotton prices. The state needs to provide capital incentive for projects involving investments of above Rs 100 crore.
