Gaurav Davda
Head of Corporate Finance & Strategic Initiatives Jindal Worldwide Ltd
Have plans to foray into B2C space
Incorporated in 1986, Jindal Worldwide Ltd is an Ahmedabad-based, vertically integrated textile company. It is one of the largest denim fabric manufacturers and suppliers with a capacity to manufacture 140 MMPA currently (and will be 160 MMPA in the next few months as capex is already underway.) of denim fabric. Gaurav Davda, head of corporate finance and strategic initiatives, gives an overview to Paulami Chatterjee on how the company is mitigating the challenges posed by COVID-19 and its future plans to get into the business-to-consumer (B2C) and technical textiles space.
How does your supply chain network work? What regions of the world are parts of your supply chain?
Our raw material supply chain is largely domestic, barring a handful of specialised products that we import from China, Europe, etc. On the finished goods side, we have more than 80-85 per cent domestic supply and the balance is used for exports.
How has the sourcing of raw materials been affected? What kind of hardships are you facing?
We haven't experienced any drastic impact on sourcing of raw materials. The process was slightly delayed earlier due to labour issues; however, it is back to normal now.
In terms of hardships, securing raw material at a good price was a challenge given the rise in prices for key raw materials like cotton. However, we were able to pass on the increase in prices. With the sudden surge in demand now, we are facing issues with capacity to supply as we are operating at a near peak capacity. This is the key reason we are planning to expand our presence across various product categories.
The virus is here to stay. What steps have you taken to mitigate its impact, be it at the supply chain level or sourcing of raw material?
First, we are hoping for a successful rollout of vaccines that prove effective in negating the impact of the virus. The pandemic has taught us all to be agile and adapt. So, we have strategised accordingly.
We have implemented all safety measures, including sanitisation, social distancing, cleaning and fumigation at our factories and offices to ensure safety of the workers. Wherever possible, we have introduced work from home. We have large long-term supply understanding with preferred suppliers and logistical service providers to ensure raw material availability and timely supply of goods, both inward and outward.
Which brands and retailers are you currently associated with?
Some of the brands and retailers who we work with are Marks & Spencer, Myntra, H&M, JC Penney, Carrefour, HRX, Westside, VMart, Pantaloons, Trends, Pepe Jeans, Future Group and Spykar.
Which are your major international markets? Are you planning to expand into any other regions in the near future?
We supply to parts of Europe, South America, North America and parts of Asia. We have made several tie-ups with partners within these geographies to mine these regions further and others to increase our exports pie.
Technology is in a sense leading the fightback. What steps have you taken to move into a more digitalised work culture?
We have encouraged some of our key office staff and vulnerable members of the organisation to work from home for the foreseeable future. We have started conducting regular review calls and also team meetings via video conferencing platforms. Our annual general meeting was also conducted virtually. Additionally, due to our robust in-house, self-developed ERP system, a lot of the reports and operational information are available remotely as well. This ensures productivity irrespective of geographic location.
By when are you expecting the revival process to commence and what is your recovery model?
Given what we are witnessing on the ground currently, it is safe to say that demand recovery is well and truly already under way. We are in the process of ramping up capacities across product lines and have made provisions to increase our export business to diversify the risk.
How are budgets earmarked for offline and online?
We are not a B2C player. So, for us online vs offline does not come into play. However, our partner brands, that we supply to, have seen a growth in their online sales. We have plans to foray into the B2C space in future and we are working on materialising this. The proposed product line will have an offline and online strategy. However, it is too early to delve into details.
List the modern facilities that you have across your textile value chain.
We have the best in the segment machines sourced from Germany, Turkey, the European Union and the Americas. These are state-of-the-art equipment that are in line with our goal of achieving energy efficiency, being environment-friendly, producing zero discharge and recycling water.
What is your growth story and what are your strengths?
Our growth story is defined by our laser sharp focus on building excellence in a defined set of products to become the leader in that product segment. Disciplined and sustainable growth is the mantra we follow. As a firm, our people and excellence in product offerings are some of our key strong points.
The textiles industry is considered to be a huge pollutant, and denim perhaps among the most. How do you try and keep the carbon footprint as low as possible?
We have installed roof-top solar units at some of our facilities to manage energy utility in a sustainable manner. In fact, we are one of India's most energy efficient unit with own captive power plant. Additionally, we have reduced our energy consumption despite a growing revenue size by over 10 per cent in the last four years through instituting energy saving measures. Also, water recycling and effluent treatment is conducted so as to substantially reduce pollution levels. We have one of the largest zero liquid discharge denim unit. Our aim is to follow industry leading practices to ensure environmental sustainability.
What are your short and long-term sustainability goals?
Sustainability is at the core of our business. By implementing best environmental practices, software and clean technology, we want to be a sustainable and responsible company.
Would you be going for capacity expansion in future? What are major goals for the next five years?
We have undertaken capacity expansion in our denim facilities. Additionally, we hope to increase capacities by approximately 20-25 per cent across all our product lines and enter technical textiles vertical in the next one or two years. We aim to more than double our FY20 revenues in three to five years. We will follow this approach, while simultaneously trying to sustain our margin profile.
Published on: 15/01/2021
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
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