New Delhi: Sangam (India) Ltd, a Bhilwada- based integrated textile firm, will invest Rs 120 crore to foray into seamless garment business and said it will pay 20- 25 per cent of its profit as dividend to shareholders.
The company plans to set up 10,000 spindles for slub yarn and mercerise unit to manufacture 10,000 pieces of seamless garment per day in next financial year, its Managing Director S N Modani said.
The seamless knitted garments are used worldwide in wellness wear, yoga wear, sportswear, intimate wear, body shapes and other wears.
The Rs 120 crore expansion plan will be funded through a term loan of Rs 89.50 crore and balance through internal loans.
This expansion plan is slated to completed by March 31, 2015."This expansion plan will add to Rs 150-175 crore to our topline from the next financial year," he said.
Seamless Garment technology is advancement in apparel industry which eliminates the fabric laying, cutting and sewing process.
By eliminating the cutting and sewing process, complete garment knitting provides a variety of advantages in knitting production such as saving in cost and time, higher productivity, quick response production, homogeneity and other advantage.
The company plans to install 36 circular knitting machines to be imported from Santoni, Italy, the world leaders in seamless knitting technology, he said.
Also, it is keenly awaiting new textile policy. "We are further evaluating other opportunities for value added product to fuel business growth of the company," he said.
The new government has set up an expert panel to draft the new National Textiles Policy, which aims to achieve USD 300 billion exports by 2024-25, and creation of additional 35 million jobs by attracting investments.
Announcing an annual dividend policy, Sangam said it will pay 20-25 per cent of annual net profit as dividend to shareholders from current fiscal.
For the year ended March 2014, it paid a 15 per cent dividend.Sangam (India) is one of the few Indian companies to announce such an annual dividend policy for its stakeholders.
For the June-end quarter, Sangam (India) reported a 88.05 per cent rise in net profit at Rs 11.34 crore compared to Rs 6.03 crore in the corresponding quarter previous year.
Net income during period stood at Rs 372.93 crore compared to Rs 367.52 crore.