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Himalaya Cotton Yarn Ltd manufactures high quality denier. The spinning mill based in Surat manufactures 100 per cent cotton yarn. Ravi Raj Desai, CEO, discusses the aftermath of GST and demonetisation on the Surat textiles industry.
What are the challenges that your niche faces?
We are basic players in the value chain. So, we have to change our products as per requirements of our consumers. Earlier, we were manufacturing yarns for saris, kurtas, shirts and pants. Today, we are making for denims and knitting units. Previously, the spinning industry had to make changes once in ten years, but now we need to upgrade every year. The machines and products also need constant improvisation. Huge capital investments are required for upgradation and sustenance in the textiles industry.
How has the industry evolved over the years?
There is a basic change. Today, there is an increase in the use of denim. Today's generation wears more fancy clothes. The use of denim has gone up drastically in last 10 years. The conventional system of manufacturing raw materials for saris and kurtas is going down, and conventional units are shutting down. Earlier, the major consumers were developing countries who spent less on clothes because of many reasons. So, the spinners were spinning polyester staple fibre and using synthetic materials. Today, as the countries are growing, mills have started producing and procuring natural fibres like cotton, viscose, bamboo fibre, banana fibre and such others.
Has Surat's textile industry recovered from the aftermath of GST and demonetisation?
Yes, we have recovered. Previously, the looms were trading in cash. But after GST and demonetisation, 50 per cent of those conventional units have shut down. The entire unorganised sector has been abolished in Surat as well as those on the outskirts of Mumbai. The number of smaller units has gone down drastically. The value chain has also been completely destroyed. The most affected has been the weaving sector, especially its unorganised and smaller units. In Surat, 80-90 per cent of the weaving industry is unorganised. Now, nearly 40 per cent have stopped functioning. Machines are also going to scrap. There are hardly any buyers for second-hand machines. It has become difficult for people to do business on a smaller scale. Either they have to collaborate with others or start with big investments.
Tell us briefly about your company. How were the last two fiscals and what is the target set for this year?
The initial company was founded by my father and uncle in 1997. Later, Himalaya Cotton Yarn Ltd was established in Surat. In the beginning, the capacity was 16,000 spindles. Today, we have 29,000 spindles. We specialise in high-twist yarns and polyester cotton blended yarn. We had a turnover of around ?24 crore last fiscal. This financial, we are aiming for ?33 crore.
Which are your major markets?
We supply to various parts in the country. The major mills are Arvind Mills, Raymond Mills, Grasim and others. We do export, but 70-80 per cent production goes for domestic use as we have tie-ups with various corporate houses in India.
What is your production capacity? Where do you source the raw materials from?
Our current production capacity is 140-150 tonnes a month. We have just taken over a unit and are planning for around 10,000 spindles in a couple of years. We source PSF from Reliance Industries and Bombay Dyeing, and cotton from Tapi district.
How sustainable are your manufacturing units?
Spinning is the most eco-friendly industry because there is no wastage of excess water. There is also no air pollution. In spinning, we just spin the raw materials.
What are your expansion plans? Do you plan to venture into garmenting?
Our expansion plan is to take over some units and improve our spindling capacity. Right now, we are looking forward to getting into processing. It might take 3-4 years to venture into garmenting. (RR)
Published on: 01/08/2018
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