Interview with Mr Manish Mandhana

Mr Manish Mandhana
Mr Manish Mandhana
Jt Managing Director & Board Member
Mandhana Industries Limited
Mandhana Industries Limited

Mandhana Industries Limited is one amongst India's premier textile and garment manufacturing companies. Vertically integrated, and present across the textile value chain from yarn dyeing to garment manufacturing, the company has global distribution facilities in USA, Italy, Turkey, France and other European countries, and a liaison office in Paris under the name 'Mandhana Europe'. Besides pan India presence, the Group products are exported to 26 countries. Mandhana’s turnover has grown at a CAGR of 37.18% over the past three years whereas net profits have grown at a CAGR of 30.72%. It has increased EBIDTA margin from 9.18% inFY06 to 20.13% in FY10. Mr Manish Mandhana is the Joint Managing Director and member of Mandhana’s board. A commerce graduate and having 15 years of industry's experience, he is the torch bearer of modernization and progress. He is an aggressive marketer, passionate, and perfection-oriented leader who bears astute pulse of latest trends in fashion. In Face2Face interview, speaking to Ms Madhu Soni, Sr Editor & Correspondent, Mr Manish Mandhana reveals more on textile and garment business, as well as factors likely to govern consumer spending and preferences in near term.

Welcome to Face2Face talk, Mr Mandhana. To begin with, we would request your word on lessons acquired during the year 2010 that is to pass away shortly? What were some vital decisions taken at Mandhana during this year?

2010 year has definitely provided us with some great takeaways. First of all, we concluded our IPO with overwhelming success and the Company is now a widely held listed Company enjoying the respect and confidence of sizeable investors. Also, the Company has undertaken multiple expansion programmes at Tarapur multiplying both its garment and weaving capacity and the total capex planned is approx rupees 3 Bn. The expanded capacity shall be operational by the end of the current fiscal year. The Company is banking on the strength of its vertically integrated manufacturing capacities backed by strong designing capabilities.

In and of itself, there are many happenings in global textile sector these days. Which out of these were turning points in your view?

As has been the talk of the town since last one year, one of most influential factors concerning global textile sector is spiraling yarn & cotton prices. The same, though adding to the pressure to on the margins, has definitely helped in changing the sector’s outlook and it will not be an understatement that it has given a new lease of life to the indigenous spinning industry. Apart from this, the dilution of Chinese force in the global textile space has definitely been felt over the past year due to their environmental concerns, Yuan appreciation and also their express liking towards the modern sectors like IT.

Africa is next growth story say some analysts. Your company has market share therein. How would you comment on this prediction?

In our opinion, it shall be a little early to form an opinion on the rise of African continent as it is just beginning to find its feet. As a matter of fact, we do not have presence in a big way in African markets.

Recently, we have carried news about your Group’s plan to foray in Retail. Can you apprise us about the developments there on? How lucrative is Retail these days, especially in established country like India?

With a view to further leveraging our designing and manufacturing capabilities in garments, we have decided to venture into Apparel Retail space. We are eyeing to enter into Men's casual wear in mid-premium segment and we already working on the product line. As regards overall retail scenario, we feel that Indian organized retail definitely has steam to grow double its size from the current size in next decade. The biggest advantage that India enjoys is the proportion of youth to total population which is close to 60%. This coupled with increasing awareness and consciousness for branded apparels is definitely driving the sector northwards.

Currently, Mandhana Industries produces 70 percent textiles and 30 percent apparels. So, would this proportion change in years to come, probably with more stress on garment and retail?

We are working on increasing our garmenting capacity from current 4 Mn pcs to 12 Mn pcs by the end of next calendar year by setting up garment units at Tarapur & Baramati. Post this expansion by FY 2013; we may see the proportion of Textiles to Garments at 60:40.

What factors are likely to govern consumer spending and preferences in near term? Would tailored-retailing (ready to stitch) concept ace RMG?

Today's consumer definitely relate to well known brands and clothing for youth today definitely is one of the status symbol tool. With the overall economic betterment of the country, there is more purchasing power at the disposal of the end consumer and there is willingness to spend an extra buck for a quality branded apparel. The most striking feature of Indian retail is the growth in market base in Tier II and III cities also where the standard of living has improved drastically. Gone are the days of buying fabric and getting it tailored which has limited design & pattern scopes. RMG is definitely the end product and score all the way over Ready to stitch.

What social agenda governs the business at Mandhana group?

At Mandhana, we firmly believe in the idea of ‘Let’s grow together’. We believe that everyone associated with us - our employees, investors, vendors, customers and the society at large – should prosper proportionately with us and that has been our constant endeavor ever since we began operations. We have contributed to this cause in many ways over the years. First & foremost, our manufacturing facilities are free of any health hazards and are fully compliant with all the safety norms to ensure safety of the workers.

We are one of the very few Indian Apparel Companies to be SA - 8000 compliant, which is a pioneer standard for measuring Social Accountability of the Companies. We have also been rewarded with many other quality & process certifications like FLOCERT, Oekotex, Control Union etc.

We also promote women empowerment through recruitment of women workers at our garmenting and weaving facilities. Regular training programmes is an integral part of our work culture and we make sure that we equip the workers with sound knowledge and technical know-how essential for their personal grooming. We also acknowledge the society's contribution to our success and endeavor to pay it back by preserving natural resources and also promoting environmental causes.

Experts also predict that the Investor Community today would be ready to bet on the Textile/Apparel companies. Your message to these investors over the next couple of years in specific to Mandhana-

The sector is surely passing through a golden phase riding on excellent domestic demand, proper prices and expanding geographical markets. During previous year, the same upbeat mood is evident from the financial results of all the leading textile companies vis -a-vis also their stock price performance. Specifically about Mandhana, we have taken care of the investor's interest the most by pricing our stock very reasonable during the IPO period and as a result, the investors have earned returns in excess of 100 % over a short span of six months in our stock. Our value added business model has been fundamental in bringing us to this stage and we thrive to secure investor's interest and their wealth protection. We are really thankful to these investors for showing faith in us and we assure them that with the same kind of faith and trust in the Company's business and management in the time to come, we shall surely give our best not to disappoint them.


Published on: 20/12/2010

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