Changing product-matrix helps MSUM notch high profits

15 Feb '13

2 min read

Changing the textile product-matrix has helped Maharaja Shree Umaid Mills Ltd (MSUM) notch high profits in the quarter ending December 31.

Net profits at Rajasthan and India based Maharaja Shree Umaid Mills Ltd (MSUM) clocked a record breaking sequential growth of more than 80 percent in the third quarter ending December 31 of fiscal year 2012-13.

MSUM also reported a stupendous 54 percent year-on-year hike in net profits in the third quarter. In the same period, MSUM has also posted a 13.6 percent year-on-year rise in sales.

In the reporting quarter, net profits from ordinary activities after tax touched Rs 14.37 crores against Rs 9.33 crores in quarter three of fiscal 2011-12 and Rs 7.93 crores in quarter two of 2012-13.

Net sales in the third quarter rose to Rs 125.67 crores, up 8 percent from the previous quarter and also up from Rs 110.71 crores in the corresponding quarter of 2011-12.

Revealing the reasons for the spectacular results, Mr Govind Sharda – Executive Director at MSUM told fibre2fashion, “We have achieved this by way of changing the product-matrix. We have introduced new value-added yarns like compact and combed yarns”.

He added, “Alongside we have also increased share of fabrics in the revenue basket. Share of fabrics has gone up from 18 percent to 28 percent in the last 12 months. This segment also played a pivotal role in hike in net profits.

“We realized that in a slow-moving economy, commodity-based product faces more heat, which is why we decided to shift our focus to value-added yarns and processed fabrics. Today we have a very comfortable order book position for our fabrics, which gives us the confidence to invest in new weaving machineries”.

When asked as to how they are able to compete with factories in the unorganized sector in the fabrics sector, he said, “We maintain strict quality controls, so despite a downturn in the market, we do not compromise on the quality of fabrics, which explains our good order-book position”.

Fibre2fashion News Desk - India

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