Interview with Mr. Sanjay Jayavarthanavelu

Mr. Sanjay Jayavarthanavelu
MD
Lakshmi Machine Works Ltd.

The demand for textile products continues to grow globally, and the textile spinning machinery manufacturers have ample scope..

Lakshmi Machine Works Limited founded in 1962, is based in Coimbatore, India. The company engages in the manufacture and sale of textile machinery in India and internationally and is one among the three manufacturers of the entire range of Textile Machinery. It operates in three divisions: Textile Machinery, Machine Tool, and Foundry. The company is also involved in the generation of electricity through its windmills. Year over year, Lakshmi Machine Works Ltd. has been able to grow revenues from INR 11.3B to 17.9B. Most impressively, the company has been able to reduce the percentage of sales devoted to selling, general and administrative costs from 15.91% to 15.82%. This driver led to a bottom line growth from INR 998.8M to 1.5B. Mr. Sanjay Jayavarthanavelu, MBA, serves as the Managing Director of Lakshmi Machine Works Ltd. He has more than 12 years of experience in the field of Textile Engineering, Machine Tools manufacture, Finance and Administration. Along with steering of LMW group to success, he is also playing the role as the Chairman of various organizations viz CII, Tamilnadu State Council and India- International Textiles Machinery Exhibition Society, Textile Machinery Manufacturers Association (India). He served as Chairman of the India-ITME Exhibition Society, Mumbai. He is a member of the Council of Administration of SITRA. Besides, Mr. Jayavarthanavelu also renders well his responsibilities towards community as a trustee of several educational, medical and other charity trusts. While speaking to Ms. Madhu Soni- Sr. Editor & Correspondent, in a second Face2Face talk on LMW and textile machinery global scene, Mr. S. Jayavarthanavelu shares his stance on opportunities and threats for the sector ahead.

Mr. Sanjay, Face2Face team feels proud for another opportunity of a colloquy on LMW post a talk with your father Late Dr. D. Jayavarthanvelu - the veteran of the industry. As we go ahead with the discourse, keeping our readers of global investor-community in mind, how if we start with an overview on the financial health of the company currently?

Lakshmi Machine Works (LMW) continues to maintain a debt free position for the last 7 financial years and the surplus funds have been safely deposited within the banking system. LMW has booked number of project orders during the year 2010-11 for execution during the FY 2011-12 and the same has facilitated for capacity utilization. However, margins are under pressure due to increasing input costs.

As LMW continues to enjoy its niche as one among the three manufacturers of the entire range of Textile Machinery, does it see Textile and Garment industry faring well in the global context?

China and India are the largest players in the Textile business and have a substantial market share globally. Because of this demand, the Textile Machinery manufacturers in both the countries have many opportunities to enhance their business.

How is Indian textile sector to fare as the New Year sets in? What shall remain as issues crippling its growth?

Indian Textile Sector caters mainly to the domestic market and the same is growing. However, financial incentives for export growth are necessary. In addition, interest subsidy for spinning while interest subsidy coupled with grants for weaving, processing and garmenting is required. Infrastructure issues such as transportation, power, port handling etc., has to be addressed.

TUFS is in for 12th plan too. How will this bid for the sector overall? In your opinion, which one of the Old and Restructured TUFS sounds benefiting the industry really?

TUFS has facilitated the Spinning Sector substantially for enhancing capacity as well as quality upgradation. However, Post Spinning sectors have not fully utilized TUFS. Continuation of TUFS in any form for the Textile Industry will enhance investment and growth.

Recently, LMW has also acquired Rieter shares in RLM, in the month of April last year. Can you please share the idea behind this? How is this move benefiting LMW’s strength in the market?

Acquisition of this facility enhances our Ring Frame manufacturing capacity. In the fibre process that is from Blow room to Ring Spinning, the Ring Frames have a substantial share.

What ethos govern R&D wing of LMW? What all shall be there to offer on the trend of going green?

Innovation and Technological enhancement to meet growing customer expectations is the driving force for R&D. All processes at LMW are environment friendly.

How has LMW planned its strategic moves for the year ahead? Any important forecasts-

In order to meet customer demand LMW has already created ample capacity. Textile Spinning Industry’s performance is always cyclical and the fortunes of the Textile Machinery Industry depend on it. The demand for Textile products continues to grow globally and the Textile Spinning Machinery Manufacturers have ample scope to sustain and grow in the year ahead.

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Published on: 13/02/2012

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.