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   Interview - KG Group Coimbatore

Mr. K G Baalakrishnan  Mr. K G Baalakrishnan 
 Chairman KG Group 
 KG Group Coimbatore

KG

Mr. K. G. Baalakrishnan is the Chairman of KG Group Coimbatore, which employs 14,000 workers with a group turn over of $250 mn. The KG group comprises of three major units namely, KG Denim Limited which produces 24 million meters of denim and cotton fabrics, 16 million meters of sheeting and 3 million pairs of jeans and Cotton trousers; KG Fabriks limited which produces 12 million meters of long staple indigo fabrics and industrial fabrics and Sri Kannapiran Mills Limited which produces 100 tons of cotton yarn daily.

Mr. Balakrishnan is also the Managing trustee of KG Medical Trust and KG Educational Trust. He is the Honorary Chairman of Indian Chamber of Commerce and Industry, Coimbatore. In his long and successful career he has been the Founder President of Coimbatore Stock Exchange Ltd., India-Srilanka Joint Business Council and Vice President of All India Organisation of Employers. He is also a member of SAARC chamber of Commerce and Executive member, Federation of Indian Chamber of Commerce & Industry –FICCI.

 
fibre2fashion:

What sets KG Denim apart from others in the Indian Markets?

Mr. K G Baalakrishnan

  • First plant in South India
  • Integrated Textile Group present in entire textile value chain – ONE STOP SHOP FOR DENIM PRODUCTS
  • State of the art plant and machinery
  • Product strength – Cotton / Yarn / Denim Fabrics / Made ups / Fashion Washes / Garment Effects – Continuous product innovation
  • Established Jeans Brand
  • Fully integrated Laundry
  • Quick response system
  • CRM and SCM
  • Real Time Quality System

fibre2fashion:

India is fast emerging as the Denim Country of the world. What does it have and have not, in its making?

Mr. K G Baalakrishnan

Have

  • India has many denim producers.
  • High level of cotton cropping.
  • Very supportive spinning mills.
  • Availability of majority of input chemicals being produced in India.
  • Availability of skilled manpower at Right Costs.
  • Large garmenting capacity.
  • Increasing domestic demand and young population.
  • Subsidy under TUFS.
  • Government's full backing to bring textile industry at par with IT sector.
Have Not

  • Adequate port and other infra structural facilities to handle huge tonnage.
  • Higher transaction costs.
  • Direct shipping lines needed in the East and West Coast (Currently shipments go through on transshipment basis through Colombo increasing lead time and cost).
  • Duty free import of chemicals needed for denim manufacture.
  • High cost of power.
  • Labor reforms.
  • Labor cost on the increase and trained manpower becoming difficult due to spurt in textile sector investment.
  • Yet to achieve greater size and economies of scale.
  • Application of Information Technology is yet to have its full role in improving efficiency and profits.

fibre2fashion:

What advantages do you see for integrated textile maker over single units and where should the Government focus on (sector wise)?

Mr. K G Baalakrishnan

  • Sourcing of products to develop products demanded by market.
  • Confirming to delivery schedules.
  • Reduced lead time.
  • In-house R & D leads to product innovation.
  • Wide reach of market.

fibre2fashion:

How are India and China poised in the denim segment and what strengths each country posses over the other?

Mr. K G Baalakrishnan

  • China has HUGE capacities, CHEAP and abundant labor, Very Low Power Cost, Regulated currency system, good infrastructure, Have large source of Indigo dye, a key ingredient for denim and cheaper indigenous machinery.
  • India has wide variety of cotton, good spinning capacity, skilled labor and technology advantage for producing quality denim acceptable to European and American markets.

fibre2fashion:

Denim seems to have a universal appeal. Where can you foresee its future?

Mr. K G Baalakrishnan

From being a cow-boy apparel and rough wear it has become a soft and fashion wear and is getting increased acceptance as an office wear. It is the apparel of the young generation and is becoming the wear of women as well as children. With more players in the industry there will be a pressure on prices.

fibre2fashion:

KG denim being a leader in this field, what is your company plan to cater to high and mid-end market segments?

Mr. K G Baalakrishnan

K G Denim is already in high end product where volumes are less. Company is not present in commodity markets. This has been possible with diverse product range with accent on product innovation and R & D. Product innovation, Quality, CRM and SCM will be our thrust areas for increasing market share.

fibre2fashion:

Can you provide an insight into the Indian market?

Mr. K G Baalakrishnan

  • Indian market is gearing to consume more denim.
  • Existing players have doubled / trebled capacity.
  • Many new players have entered the market
  • Companies are becoming integrated in the value chain either through same companies or through group companies.
  • High and Mid segment are growing faster than low end segment.
  • Volumes in the low end segment are on the increase.
  • Branded denim commands high premium but however requires continuous ad spending.

fibre2fashion:

How big is the international market for Indian denim and what new areas do you consider as prime areas that will fetch valuable foreign exchange for the country?

Mr. K G Baalakrishnan

Around 50% of domestic output of 300 mln meters is exported to world markets. Indian denim is preferred for quality and consistency by European and American converters. Higher thrust on branded garmenting will increase exports.

fibre2fashion:

R&D is the mainstay from any company today. Can you explain what activities are being taken on this front?

Mr. K G Baalakrishnan

In-house development of products through continuous product innovation with the concept of Speed to Market, development of new yarns / functional coordination, use of natural dyes, new wash effects and construction keeping in line with the changing fashion scenario.

 
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Published on : 08 May 2006
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