Kitex Garments on Monday announced that the company has signed the Memorandum of Understanding (MoU) with Telangana State Government for investing Rs 2,406 crore in the state for two industrial projects.The company said the proposed investment is planned at Kakatiya Mega Textile Park, Warangal and Industrial Park, Sitarampur, Rangareddy district. The Warangal project will start by October whereas the commercial productions will start by December and Kitex expects full capacity by December 2023.
The Rangareddy project is expected to start by April 2022 and the commercial production of the same will commence by June 2023 with the full capacity by June 2024. Kitex has an existing capacity of 4,32,000 units (infants garments) per day and proposes to increase to 18 lakh units per day.
Kitex Garments said the rationale behind investment is that the Telangana state has among the top 3 states for ease of doing business. The state is also the third largest cotton producer. The company also plans to utilize attractive incentive scheme in Telangana Textile Apparel Policy, better logistics, infrastructural facilities, reduced cost of labour and its availability and overall cost reduction. The garment is aiming for overall cost reduction and thereby increase in profitability in the long run.
Kitex Garments is engaged in the manufacture of fabric and readymade garments. The company operates through two business segments: garments and fabric. The firm also exports cotton garments principally infants wear. On a consolidated basis, the company posted a 62% rise in net profit to Rs 20.51 crore on a 71.6% rise in net sales to Rs 153.78 crore in Q1 FY22 over Q1 FY21.
Shares of Kitex Garments were trading 1% higher at Rs 171.45 on BSE. The scrip surged 4.86% to hit a day's high of Rs 178 on BSE.
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