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SRI GURU GOBIND SINGH COLLEGE OF COMMERCE, DU
PGDIM(2012-2013)
PROJECT REPORT
ON
FINANCING OF TEXTILE INDUSTY
Project Guide :
Submited By:
JASVINDER SINGH
SHRUTI JAIN
Roll no. 127021
CERTIFICATE
The Project entitled “Financing of Textile equipments”
submitted by
SHRUTI JAIN to the SGGSCC, DU in partial fulfillment of the
requirement of the PGDIM Course is a Bonafide work done by
her under my supervision.
All references and sources of data have been duly
acknowledged.
The work has not been submitted elsewhere for award of any
other degree.
2
JASVINDER SINGH SHRUTI JAIN
{Project guide} Roll no.
127021
EXECUTIVE SUMMARY:
The Indian Textile Industry is one of the largest in India. After
a decade of slow-down in the textile sector due to a variety of
factors like quota restrictions for exports, high cost of cotton
and low domestic demand, the industry is now on a recovery
path. This has become possible due to lifting of quota
restrictions, Govt.’s encouragement and incentives, higher
domestic demand for branded garments and better GDP. All
these factors predict a rosy picture for the textile sector.
The research has been conducted to get an insight into the
size of the textile industry, size of textile machinery, new and
used, and their viability .
Various recommendations have been made as per the findings
of the research and survey.
3
During the research and survey, the details about textile
machinery, their product profile, latest models, price range
etc., their customers and manufacturers were studied.
ACKNOWLEDGEMENT
I extend my thanks to my mentor for his continuous
support, encouragement and mentorship throughout
the duration of the Project.
I would like to express my gratitude to all those who
have contributed in their own way for completion of
the project.
.
4
TABLE OF CONTENTS
S.N
o.
Contents Page
Nos.
1. Executive Summary 3
2. Acknowledgement 4
3. Objective of the Study 8
4. Methodology 8
5. Introduction 11
6. Size of the Industry 12
7. The Change-over 14
8. Export and Import Scenario 21
9. Textile machinery status in India 26
10. Used Textile Machinery status in India 30
11. Foreign Textile Machinery manufacturers 30
12. Indian Textile Machinery Manufacturers 32
13. End-users of Textile Machinery 33
14. Textile Mills Distribution in India 34
15. Textile Manufacturing process 36
16 Types of Textile Machinery 37
17 Price Variance of Textile Machines 44
18. Market Survey 45
5
19. Company Profiles 48
20. Recommendations 58
21. Annexure - Birla Textile Mills 63
22. Annexure - bibliography 69
OBJECTIVES OF THE STUDY
6
The research study was undertaken with the prime objective of
ascertaining the scope and viability of financing of Textile
Machinery in the prevailing market in view of the post quota
scenario.
Further, the other objective was to study the market of the
textile machinery, leading manufacturers, and composition of
users.
7
METHODOLOGY
1. Time period 2 months
2. Territory New Delhi
3. Data Collection Both primary and secondary data
have been
collected from various sources.
Primary Data:-
This data is procured by the researcher by collecting first hand
information from the concerned companies/persons. The
primary data was collected from:
i) M/s. Spintex Pvt.Ltd.
ii) M/s. Chemtex Pvt.Ltd.
iii) State Bank of India
Secondary Data:-
This type of data is the one which has already been collected
by someone else and the researcher compiles the data
according to his requirements.
The data of the following companies was collected:
i) M/s. Lakshmi Machine Works
8
ii) M/s. JCT Textile Mills.
INTRODUCTION
INDIAN TEXTILE INDUSTRY
Textile industry today occupies a unique place in the economy
of the country by virtue of its contribution to industrial output,
employment generation and foreign exchange earnings.
The industry uses a wide variety of fibers ranging from natural
fibers like cotton, jute, silk and wool to man-made fibers like
polyester, viscose, acrylic and multiple blends of such fibers
and filament yarns.
The textile industry covers a gamut of activities ranging from
production of raw material to providing high value added
products such as fabrics and garments.
At present the textile industry is the second largest single
industry accounting for around 20% of the total industrial
output and employs in aggregate around 82 million people
taking in consideration all sectors of the textile industry.
9
Indian textile industry has inherent strengths in terms of
- strong multi-fiber raw base
- low cost of labor
- intellectual capital
- dynamic and vibrant entrepreneurship
The industry is extremely complex and varied in structure with
hand-spun, hand-woven sector at one end of the spectrum and
sophisticated capital intensive high speed operations on the
other. There is also an intermediate segment consisting of
decentralized small scale power loom units.
10
PLACEMENT OF INDIAN TEXTLE COMPANIES VIS-A-VIS
FOREIGN COUNTER-PARTS
India and China are the two countries, which are going to be
benefited. However, China is going to be benefited to a greater
extent than India as China has modernized the textile industry
to a greater extent than India. The reason being when China
joined the WTO its textile industry was at a very primitive
stage so very quickly they have ramped up their capacity to
meet the US and EU quality standards . But in India, going by
the duty regime and where sops were being given to other
sectors such as IT, the textile industry was never favored.
Subsequently things have changed and now they have been
fairly large scale investments in spinning. However, India still
lacks the required investments in weaving, processing and
dying segments. Now lot of interest is being generated in
these segments, as the textile industry has realised that, if
they want to export garments they have to meet the global
standards of quality
11
SIZE OF THE INDUSTRY
Indian textile industry is the second largest in the world –
second only to China. It accounts for 38 % of the country’s
total exports and is therefore a very important industry. It
also contributes to 4% of the GDP and 14% of value addition
in manufacturing sector.
The industry has witnessed a phenomenal growth during the
last decade in terms of spindle-age, production of yarn {both
spun and filament}, output of cloth and its per capita
availability as also exports.
The official statistics of India provided by DGCI&S show that
the textile exports amounted to $ 6812.53 millions as against $
6242.30 million during the same period in the previous year,
showing an increase of 6.04%.
India’s imports continued to record growth. Imports were
worth $ 918.83 millions as against $ 684.36 millions recording
a growth of 34.26%.
12
The above position and statistics indicate that the country is
now on the path of speedy recovery and is determined to
compete internationally in all aspects of growth.
FEW FACTS ABOUT THE INDIAN TEXTILE INDUSTRY
1. There are approximately 1200 medium to large textile
mills in India. 20% of these are located in Coimbatore
(Tamil Nadu).
2. Indian has 34 million cotton textile spindles for
manufacturing cotton yarn. Cotton yarn accounts for 70%
of India’s textile exports.(China has 40 million cotton
textile spindles)
3. Of the Indian textile yarn exports, almost 80% comes
from coarser
Yarn. Consequently, there is a need to upgrade the
technology.
4. For the past few years a significant slowdown in the
13
cotton spinning segment mainly due to the spiraling
prices of cotton was seen. But now the situation has
stabilized.
5. The domestic knitting industry is characterized by small
scale units,
which lack adequate facilities for dying, processing and
finishing.
6. The industry is concentrated in Tirupur (Tamil Nadu) and
Ludhiana
(Punjab). Tirpur produces 60% of the country’s
knitware exports.
Knitted garments account almost 32% of the exported
garments. The
major players include:-
i) Nahar Spinning Mills Ltd.,
ii) Arun Processors and
iii) Jersey India.
THE CHANGE-OVER FOR THE TEXTILE
INDUSTRY:
14
Various factors that have accelerated the growth of the textile
industry have been discussed below. The Textile industry,
after a decade of recession is now recovering. External factors
like, abolishment of quota and internal factors like the TUFS
are contributing to the growth of the industry.
QUOTA LIFTING
Quota based curbs for textile exports to US and European
Union nations were lifted on 1.1.2005. With the restrictions off
and globalization in full swing, the Indian industry is now
exposed to global competition. Indian manufacturers and
exporters now have to compete with the global players and
also face emerging tariff and non-tariff barriers.
AGREEMENT ON TEXTLES AND CLOTHING
15
For the last four decades, the textiles trade was governed by
the Multi-fibre Agreement (MFA) which imposed quota
restrictions and relatively high tariffs for international trade.
This has been preventing countries, like India from penetrating
to lucrative global markets. Agreement on Textiles and
Clothing (ATC) aims to integrate the textile sector into the
WTO.
As per ATC, member nations of WTO would have to do away
with all the quantitative restrictions on textiles / clothings
from Ist January,2005 and the global textile and clothing
industry is expected to undergo the following revolution :-
Production bases would shift from developed to
developing countries
Cross-border trade would get simpler, efficient and
extremely dynamic.
International apparel prices would decline significantly.
Advantages:-
Removal of quota restrictions will increase outsourcing of
textiles from low cost manufacturing bases like India and
Indian textile industry has the potential to double its
share in the global market to 6% by 2010.
A significant surge in exports is unlikely in the first year
and it may take 3-5 years for the country to increase the
16
capacities and improve the infrastructure to capitalize on
its true potential.
Garment sector is the largest in the industry and it is
expected to contribute exports of around $ 23 billion by
2010 with major international players making clearing
intentions to source the apparel from the Indian market.
The country is a larger player in the cotton textiles
market and the sector stands to gain significantly from
the higher derived demand from rising garment exports.
India’s share in import of man-made fibres by US has
been stagnant at 3% and quota removal offers huge
opportunities.
Challenges:-
On removal of quotas, the textile exports have to cope up
with new challenges like growing regionalization between
blocks of nations, child labour, anti-dumping duties, etc.
India has to take on competitors like China, Pakistan,
Bangladesh etc.
India’s man-made fibre industry has pre-dominantly
catered to the domestic market and the share of
synthetics in textiles export basket is very low. In
contrast, China has well established presence in
synthetics and in quota free regime they will leverage on
17
its strong presence to significantly increase share of its
synthetic exports.
If the industry do not attend to the very vital needs of
modernization, quality control, technology upgradation,
etc. it is likely to be left behind.
TECHNOLOGY UPGRADATION SCHEME 1999 {TUFS}
The objective of the scheme is to provide funds for
technology upgradation of the existing units and setting
up new units with the state-of-the-art technology.
Interest incentive (5 %) on term loans, reimbursement of
exchange fluctuations (up to 5 %) and foreign currency
loans and capital subsidy (20%) on small scale power
loom units upto a cost of Rs.60 lacs are provided.
Launched from 1.4.1999 for 5 years, the scheme has been
extended upto 31.3.2007.
Original outlay of Rs.25,000 crores, additional funds of
Rs.435 crores allocated.
Till 30.9.2004, loans aggregating to Rs.9000 crores have
been sanctioned. Rs.7500 crores have been disbursed.
(project cost Rs.15570 crores)
18
EXPORTS AND IMPORTS SCENARIO
The export size of cotton yarn constitutes around 70% of the
Indian textile exports. The garment exports from India are also
growing and there is a good scope in this sector. The export
and the import scenario of Garments and cotton yarn have
been discussed . The demand for the next ten years has also
been projected.
GARMENT EXPORTS
Crisil research expects garments exports for India to grow at a
CAGR of 11-12% to $ 16 billion by 2009-10. The growth will be
significant in view of the lifting of quota restrictions w.e.f.
January.2005. The quota liberalization has prompted many
international retail giants like Walmart etc. entering into long
term supply agreements with many leading garment
manufacturers.
19
The domestic sale of readymade garments is expected to grow
at a CAGR of 10-11% to $ 24 billion by 2009-10. Continuous
GDP growth of 8% for the last three years is expected to
further boost the sales of garments specially branded
garments. This has prompted the leading manufacturers in
coining their dedicated brand outlets. Further, Govt.’s
impending policy of allowing FDI in retail is likely to boost
domestic sales.
Further sub-segments including cotton yarn and man-made
fibres are likely to witness high growth
COTTON YARN EXPORTS
The cotton yarn demand growth primarily depends on growth
of the end-user industries – apparel {clothing} and home
textiles {non-clothing). The direct yarn exports growth
depends on the growth of the clothing and non-clothing
industries of the country where the yarn is exported.
Crisil researches’ analysis expects the demand for cotton yarn
to increase at a CAGR of 7.3% from around 2420 million kgs. in
2005-06 to 3446 million kgs. in 2010-11.
The demand derived from clothing and non-clothing sales
would witness a CAGR of 7.8% during 2005-06 to 2010-11,
whereas the demand derived from apparel, made-ups, and
20
fabric exports is expected to grow at a CAGR of 14.2% during
the same period. Direct yarn exports would witness a negative
growth of around 2% per annum till 2010-11.
COTTON YARN : SEGMENT WISE DEMAND GROWTH
(in Million Kgs)
2005-
06
2010-
11
CAGR
(in
%age)
Demand derived
from -
-Domestic clothing 1123 1569 6.9
-Domestic non-
clothing
576 902 9.4
-Clothing Exports 161 391 19.4
21
-Non-clothing
exports
92 141 8.8
-Direct fabric
exports
59 74 4.5
-Direct yarn exports 408 369 -2.0
TOTAL YARN
DEMAND
2420 3446 7.3
{ Source- Crisil – INFAC.}
TEXTILE MACHINERY IN INDIA
The textile machinery industry is reviving after a decade of
recession due to quota restrictions on exports from India to
the US and EU countries. The Government’s measures to re-
structure the debts of textile mills and make them viable have
propelled the investments in the machinery.
22
- The total demand for textile machinery soared to Rs.7,178
cr.
- The market is projected to grow at an average nominal
growth rate of 6%.
- The demand for textile machinery is mainly from end-
users in the cotton textiles, knitting, dyeing, processing,
finishing, man-made fibres and wool units textile sector.
- Approximately 120 companies manufacture the complete
range of textile machinery.
- Imports constituted 45% of the total textile machinery,
Approximately USD 80 million of Indian textile machinery
is exported to other developing countries.
MAJOR PROBLEMS OF THE INDUSTRY
1. High cost of finance
2. Inadequate design and engineering capability
3. High cost of raw material and components
23
4. Demand constraints
5. Competition from foreign countries as a result of
lowering of import duties on textile machinery.
6. High quality of imported textile equipments
IMPORT MARKET SHARES
The total market for the imported textile machinery is large.
There is a growing demand for imported machinery, owing to
their good quality and technological superiority.
24
The distribution of country wise imported textile machinery
has been summarized below:
EQUIPMENT MARKET SIZE
Out of the following machines used:
- Carding Machine
- Winding Machine
25
- Warping Machine
- Sizing Machine
- Ring Frames
- Looms
Ring frames and looms hold the largest share of textile
machines, quantity-wise, in a textile company. Therefore, the
market for these two machines is
more lucrative.
IN INDIA CARDING MACHINE MANUFACTURERS DO NOT
MANUFACTURER CARDS
This is a very high precision area. It needs to have mechanical
engineering, textile and service skill sets to manufacture these
card clothing. So the conflict has always been that whether to
concentrate on manufacturing the card
26
clothing or carding machines. Generally, the carding machine
manufacturers work in tandem with the card clothing
manufacturers, e.g Now, Trutzschler have acquired
Hollingsworth GmbH in Germany
Historically, there were 3-4 card machine manufacturers in
India- Lakshmi Machine Works, Mahindra Machinery Company
(MMC), Mafatlal Engineering Industry (MEI).
There are 6-7 global players based in US (Hollingsworth), UK
(English Card Clothing), Switzerland (Graf), Germany (Tuchler),
Japan (Kanai) and in India there are two players. One is ICC
and the other is Lakshmi Card Clothing. All the other major
players except ICC, LCC and UK based company- ECC are
represented in India through agents. ECC has its own
manufacturing facilities in India. Besides these players, there
are also quite large number of smaller players who are fairly
regional or local.
STATUS OF USED TEXTILE MACHINERY
Industry analysts note that textile prices are increasingly
competitive world-wide as more and more developing
27
countries enter the global textile trade e.g. entry of Bangla
Desh, Taiwan, Pakistan, Sri Lanka.
To maintain, if not increase, its global market share, the Indian
Textile industry must procure modern, low cost machinery so
that it can high quality textiles and garments for exports at
competitive prices. It is in this context that market for used
textile machinery is viewed as very promising.
Used textile machinery permits India to incorporate technology
at low cost.
Since for the past many years, market has been in a recession.
As a result, market players have become very cost conscious
and price sensitive. However, the future looks bright for the
used textile machinery. This market segment is likely to grow
faster than the broader market. The major factors that are
likely to produce for this chapter include –
1. A world-wide increase in demand for Indian textiles
and garments
2. Lowering of customs duties on imported textile
machine
3. Reduced Government restrictions on import of used
capital goods
4. Reduced cost of used equipments which make textile
manufacturing operations more viable.
28
MARKET-SHARE
The market share for used textile machinery is approximately
20% of the total market for the textile machinery.
The industry prefers to install quality used textile machinery
in anticipation for growth in global demand. This is expected
to accelerate the demand for used textile machinery.
COUNTRY-WISE IMPORT MARKET SHARE OF USED
TEXTILE MACHINERY
29
(Source –
Industry Consultants)
DISTRIBUTION OF IMPORTED USED MACHINERY BY
TYPE
1996-97 2009-10
Winding/reeling machine 20.0 % 25.0 %
Weaving machines 14.5 % 18.8 %
Textile spinning machines 12.5 % 22.2 %
Carding machines 5.5 % 11.0 %
Others 34.0 % 38.4%
(Source – Industry Consultants)
30
TEXTILE MACHINERY - BEST PROSPECTS
- Textile winding or reeling machines
- Textile spinning machines
- Weaving machines
- Carding machines
- Air jet looms
- Auto coners
- Texturising machines
- Ring frames
(Source – Industry Consultants)
31
FUTURE MARKET – USED TEXTILE MACHINERY
Almost 90% of demand for used textile machinery is likely to
come from private sector, the Govt. owned National Textile
Corporation {NTC}, which acquired approximately 140 failing
textile units, is the only prospective end-user in public sector.
Open-end spinning units and auto-coners are likely to be the
most demanded pieces of machinery.
Future demand for used textile machinery is projected to grow
at approx. 15%.
LIST OF MAJOR FOREIGN TEXTILE MACHINE
MANUFACTURING COMPANIES
Sr.N
o.
Name of the
company
Country
1 CORGHI ITALY
2 CAIPO FILOPIU ITALY
32
3 TSUDOKAMA JAPAN
4 MITSUBISHI JAPAN
5 REITER GERMANY
6 TRUTZSCHLER GERMANY
7 MESDAN ITLAY
8 BENTLEY ENGG UK
9 SULZER GERMANY
10 DORNIER UK
11 SOMET
12 CTMTC CHINA
13 YANTU TAIWAN
14 HANSHIN KOREA
15 SANGYONG KOREA
16 CROSROL SWITZERLAN
D
17 VOLKMAN GERMANY
18 SCHLFHORST GERMANY
19 ZELL GERMANY
20 STORMAC GERMANY
33
LIST OF MAJOR INDIAN TEXTILE MACHINE
MANUFACTURING COMPANIES
Sr.No. Name of the company City
1 LAKSHAMI MACHINE WORKS (LMW) COIMBATOR
E
2 KTTM {a joint venture between
Kirloskar and Toyota Corporation,
Japan.}
BANGALORE
2 TEXTOOL LIMITED COIMBATOR
E
3 TRUMAC ENGG COIMBATOR
E
4 NEW STANDARD ENGG. MUMBAI
5 THE INDIAN CARD CLOTHING CO.
6 RJK KINARI WALA AHEMDABA
D
7 RB ENGINEERING AHEMDABA
34
D
8 JUPITER ENGINEERING AHEMDABA
D
9 RAJESH INDUSTRIES
10 RADHIKA ENGG. COIMBATOR
E
11 AMRIT LAKSHAMI COIMBATOR
E
12 PRASHANT TEXTILES AHEMDABA
D
MAJOR END USERS OF THE TEXTILE MACHINERY
35
Name of the company Location
RAYMOND Ltd. MUMBAI
DCM TEXTILES NEW DELHI
S.KUMARS CALCUTTA
RELIANCE INDUSTRIES AHMEDABAD
MAFATLAL INDUSTRIES MUMBAI
ARVIND MILLS Ltd. AHMEDABAD
NAHAR SPINNING LUDHIANA
JCT FABRICS PHAGWARA
GINNI FILAMENTS AHMEDABAD
MAHAVIR SPINNING LUDHIANA
CENTURY TEXTILES MUMBAI
‘LNJ’ BHILWARA GROUP BHILWARA
- RAJASTHAN SPINNING BHILWARA
- BHILWARA MELBA DE BHILWARA
- BSL LTD BHILWARA
- BHILWARA SPINNERS BHILWARA
- MARAL OVERSEAS LTD BHILWARA
GTN INDUSTRIES HYDERABAD
GTN TEXTILES HYDERABAD
ABHISHEK INDUSTRIES LUDHIANA
BOMBAY DYEING MUMBAI
36
NUMBER OF COTTON/MAN MADE FIBRE TEXTILE MLLS
(NON SSI) AND ITS INSTALLED CAPACITY AS ON 31-01-
2010)
Sr
No
.
State/
UT
Spin
ning
Mills
Com
posit
e
Mills
Tota
l
Mills
Spindle
s
Rotor
s
Loom
s
Knit
Mch.
1 Andhra
Pradesh
101 1 102 215633
5
6036 520 1
2 Gujarat 58 54 112 289884
6
40648 20833 20
3 Haryana 76 2 78 393446 74800 135 3
4 Himachl Pr 17 0 17 546248 3979 0 5
5 Karnataka 47 7 54 100648
5
8848 1162 0
6 Kerala. 32 4 36 841284 1960 1064 0
7 M.P. 40 12 52 124658
0
16260 2175 102
37
8 Maharasht
ra
130 64 194 467625
7
38136 25155 26
9 Orissa 16 1 17 367440 3904 1048 0
10 Punjab 78 4 82 162150
8
39096 1168 12
11 Rajasthan 45 8 53 135791
2
19616 826 55
12 Tamil
Nadu
814 26 840 134958
56
11976
5
6317 177
13 U.P. 55 10 65 162337
8
9592 5374 0
14 West
Bengal
22 9 31 955083 2400 4645 0
15 Pondicherr
y
9 2 11 188656 2888 1136 0
38
TEXTILE MANUFACTURING PROCESS
PROCESS PRODUCT
COTTON
STEP 1 GINNING GINNED COTTON
STEP 2 BLOWING BLENDING SORTED COTTON
STEP 3 CARDING PROCESS SLIVER
39
STEP 4 COMBING COMBED SLIVER
STEP 5 STEP ROVING ROVE
STEP 6 SPINNING YARN
MAJOR TYPES OF MACHINERY USED IN THE PROCESS
1. BLOW ROOM MACHINE
The main purpose of this machine is to open up the fibres and
remove the impurities.
2. CARDING MACHINE
It is further used to purify the raw material and remove the
short fibres. Slivers are formed at this stage
40
3. DRAW FRAME MACHINES
These machines combines the slivers by mixing them and
bringing in homogeneity in them.
41
4. SPEED FRAME MACHINES
The slivers that are fed are \reduced in diameters and twists
are given to the thread.
42
5.RING FRAME MACHINES
These machines helps to give further twist to the threads and
the yarn is made
43
6. WINDING MACHINES
These are used to connect the bobbins to carry out the loom
process. A continuous length of thread is produced.
44
7. WARPING MACHINES
Different threads are put in parallel sheets, wounded on the
beam. Threads of longer lengths are produced.
45
8. SIZING MACHINES
These machines enable the application of blue or starch or
some strengthening material to the threads to give them
strength and prepare for the weaving process.
46
9. PROCESSING MACHINERY
- DYEING MACHINES
- PRINTING MACHINES
PRICING
Sr
No..
Name of the textile
Equipment
Approx. Price range
(excluding Tax &
duties)
47
{Rupees in lacs }
1 BLOW ROOM MACHINE 40
2 CARDING MACHINE 17.5 to 43
3 DRAW FRAME 18.5 – 24
4 SPEED FRAME 19 – 38
5 RING FRAME 13.2
6 WINDING MACHINE 9
7 WARPING MACHINE 11-12
8 SIZING MACHINE 100
9 SECTIONAL WARPING 11
10 LOOMS .50
MARKET SURVEY
A market survey was conducted to study the financial needs
and expectations of textile companies and suppliers of textile
machinery.
48
A questionnaire was designed and administered to them.
Details about their equipment, tie-ups with financial
institutions (FIs), details regarding existing loans (term loan),
future needs and their perception about ABN AMRO BANK was
collected. The details are as follows:
Further, other banks’ rates of interest, their marketing
strategy in regard to textile mills was also gone through e.g.
the recent sanction of term-loan and working capital loan to
M/s Birla Textile Mills at Baddi was studied.
From the survey, the following findings emerged :-
TEXTILE MACHINERY:
i) The average life of textile machines is around 10-15
years.
49
ii) Quantity wise, ring frame machines are needed the
most and thus this is a vital part of a textile unit.
iii) The market for second hand machinery is quite large
and in the post quota scenario, where small textile
units are expanding, the demand for such machinery
is likely to rise.
iv) There has been no significant upgradation in Dyeing
and Printing Machines in the recent years.
v) The machines that need to be most frequently replaced
are the carding machines.
vi) For quality finished products, high-tech machines are
not manufactured in India, instead they are being
imported by the users.
vii) Some users are opting for upgradation in the existing
machines by certain additions/alterations.
The suppliers of textile machinery based in Delhi were visited
were also studied to understand their product profile, the price
range of the textile machinery offered and their customers.
50
The major suppliers which were studied included M/s Chemtex
Pvt. Ltd. , M/s Spintex Pvt. Ltd.
Following are the findings :
i) In the present post quota abolition scenario, there is
al-round expansion by the existing companies.
ii) The Govt.’s scheme of Technology Upgradation Fund is
being extensively utilized by the companies in which
they are expanding, upgrading their machines to
produce quality and value added products with an eye
on exports.
iii) At present, State Bank of India, Bank of Baroda,
Corporation Bank, HDFC, ICICI are actively involved in
financing the plant and machinery of the textile
companies.
iv) Suppliers were of the view that by offering attractive
terms, ABN AMRO Bank can also enter the financing of
this sector.
51
FOLLOWING ARE THE INDIVIDUAL COMPANY PROFILES
:
COMPANY PROFILES
M/S CHEMTEX TECHNOLOGIES PVT. LTD
D-1/25, 2nd Floor, Janakpuri,N.Delhi-110058.
Phones: 28525801
E-mail : [email protected]
Contact person : Mr.Yogesh; 9312481095
This company deals in trading of textile machinery for Indian
and foreign manufacturers. The company also deals in used /
second hand machinery of Indian and foreign origins.
52
The company’s brochure for various machinery and its price is
as follows:-
Sr,No
.
Machine with features Price
1 RAISING MACHINE
Roll width 2000 mm
Raising Rolls 24 in no.
Model RA 3
US $ 35000
2 HIGH SPEED RAISING
MACHINE
US$ 74000
3 SHEARING MACHINE`
(HYDRAULIC TYPE)
(ROLL WIDTH 21MM)
WITH EXTRA BLADES,
AUTO METAL DETECTOR
AUTO SEAM DETECTING
DEVICE
US$ 68000
4 -DO- SECONDHAND US $ 35000
5 DYEING MACHINE
MODEL – AM OHD 300
US $ 78000
53
MAX.CAPACITY TO 250-300
KG
WIDTH 2600 MM
6 SECOND HAND US $ 53000
7 SINGLE JERSY
AUTO STRIPPER CIRCULAR
KNITTING MACHINE
T-SHIRTS 500 PCS PER DAY
US $ 68000
8 CHENILLE MACHINE
YSY 706
THREAD YARN PRODUCT
NO.OF SPINDLES 20
6 SETS OF USED YSY 706 US $ 6500
CUSTOMER BASE
1 M/s Classic Apparels Pvt Ltd., Pallachi, India
2 M/s SCM Textile Processing Mills, Erode, India.
54
3 M/s Kudu Knitwear,Ludhiana
4 M/s Concorde Textiles,Chennai.
M/S SPINTEX PVT. LTD
Contact person : Mr.A.L.Khurana, 9899375240
301, Harsha House, Karampura Commercial Complex,
New Delhi-110015
Tel.: 91-11-25920530, 25920531, 25920532
Fax: 91-11-25920536, 25920537
E-mail: [email protected]
This company deals in trading of textile machinery for Indian
and foreign manufacturers. beginning in 1972, today the
Spintex group is specialized in the marketing of Textile
machinery projects catering to Spinning, Weaving and Knitting
industry. With four companies under its belt, each specializing
in different spheres of Textile Industry, the Spintex Group is
marching ahead with a vision- to make the international
technology available to Indian manufacturers.
55
Spintex has entered into joint venture with technological
giants across the world and what has taken Spintex to the
pinnacle is a motivated and dedicated work force
Spintex Group of Companies.
-Spintex Pvt. Ltd.
(Spinning - Machinery & Accessories Division)
-Spintex Corporation
(Knitting - Machinery & Accessories Division)
-Indo Seo Jin Overseas Ltd.
(Knitting - Machinery Division)
-Spintex Impex Pvt. Ltd.
(Industrial Product Devision)
56
Activities of the company
Spintex Group is specialized in the Marketing of Textile
Machinery products catering to spinning, Weaving, processing
& knitting Industry. Our motto is the TOTAL CUSTOMER
SATISFACTION.
Credibility of the company
Spintex Group has served the Textile Industry for the last over
30 years quite successfully and has a name in the Industry.
Today, its turnover is above Rs. 30.00 crores with a vision to
increase the same to Rs.100.00 crores in the near future.
1. Consistency in the service.
2. Timely and Quality supply of products.
3. Complete customer's satisfaction.
4. Company has qualified and technical staff to handle the
sales & services.
5. Covers all the territories as the company has its head office
at Delhi with
57
Regional offices at Mumbai, Chandigarh and Tirupur and
Branch offices
at Panipat, Ludhiana, Indore and Bangalore.
6. Company is having world renowned foreign associates
whose products
are being handled successfully.
The company’s brochure for various machinery and its price is
as follows:-
Sr,No
.
Machine with features SUPPLIERS
1 BLOW ROOM MACHINE LMW
TRUMAC
2 CARDING
MACHINE
TWIZZLER
REITER
LMW, TRUMAC
3 DRAW FRAME LMW/TRUMAC
REITER
TWIZZLER
4 SPEED FRAME LMW, ZINSER
58
5 RING FRAME LMW
KTTM
6 WINDING MACHINE RJK KINARWALA
RAJESH INDS.
RADHIKA ENGG
7 WARPING MACHINE JUPITER ENGG.
RB ENGG.
AMRIT LAKSHMI
8 SIZING MACHINE JUPITER ENGG
RB ENGG
AMRIT LAKSHMI
9 SECTIONAL WARPING PRASHANT GAMMA
TEXTILES
JUPITER ENGG.
TECHMECH
10 LOOMS PICANOL
SOMET
SMITH
CTMTC
SULZER
WAMATECH
59
CUSTOMER BASE
1 M/s Classic Apparels Pvt Ltd., Pallachi, India
2 M/s SCM Textile Processing Mills, Erode, India.
3 M/s Kudu Knitwear,Ludhiana
4 M/s Concorde Textiles,Chennai.
M/S JCT MILLS LTD
NAME : JCT MILLS LTD, PHAGWARA, PUNJAB
DELHI OFFICE : THAPAR HOUSE,
JANPATH. N DELHI
E-mail [email protected]
Website www.jcttextiles.com
JCT Mills, Phagwara is a established name in the field of
textiles in Northern India with two composite mills at
Phagwara in Punjab and and Sriganganagar in Rajasthan.
60
Modernisation of the plants has resulted instate-of-the-art
manufacturing facilities in Spinning, Weaving and Processing.
Its mills produce wide range of 100% cotton and blended,
woven grey and processed fabric in varieties of weaves and
finishes.
DETAILS OF THE LATEST GENERATION MACHINES ARE
AS UNDER:-
S.No. Name and particulars of the Machine Supplier
1. Ring Spinning for Open End Spinning LMW
2. Blow Room Lines Trumac
3. Cards, Combers, Drawframes Simplex
4. Ring Frames LMW
5. Open End Spinning Crosrol
6. Carding machines Crosrol
7. Post Spinning Autoconers Schifhorst
8. Weaving – Warping,Sizing
Benninger,Stormac,Zell
9. Looms Sulzer
10. Processing-Singeing & Desizing Pyrex
61
11. Chainless Merceriser Benninger
12. Continous Dyeing Range Monforts
13. Printing- Rotary printing Stormac
14. Sueding Sucker Muller
Company’s products (approx. Million meters per annum) with
50 cm width are available in weaves like Twills, Satins, Broken
Twills, Canvasses, Tussores,
Dobbies, Bull Denim, Lycra and finishes such as Dyed, Yarn
Dyed, Prints, Bleached and fabrics including camouflage for
Defense forces.
RECOMMENDATIONS
1) In the changed scenario after quota lifting, higher national
demand for value added/branded garments, FDI in retail, ever
increasing middle class in India and strong GDP growth, there
is huge scope for expansions in the textile sector in India.
Further, in view of the recent and impending tie-ups between
the manufacturers and giant retail chains of the world like
Walmart, etc., there is ample assurance that the Indian
companies are in for a rich harvest.
62
The GOI is providing several and fiscal and financial incentives
to promote textile projects which are export oriented. The
USD 5800 million TUF Scheme has been approved by the
Govt. with the objectives of modernizing and technologically
upgrading textile and jute industries to enhance their viability
and competitiveness. Under the programme, adequate funds
are available to finance all techno-economically viable
projects.
It is easier to acquire funding for export oriented units (EOUs)
under TUF programme and favourable loans are easy to obtain
for companies in textile industry.
Banks like, SBI, OBC, are offering attractive interest rates for
- Term loans (SBI 2.5% OBC 3.5% under
TUFS)
- Working Capital loans (SBI 9% OBC 9.5%)
With the progressive removal of discrimination against the
organized sector {quota lifting} , TUFS have picked up
significantly during the recent years. The loan amount of Rs.
14.261 cr. disbursed so far represents an investment of around
Rs. 30,000 cr. And investment outside TUFS is likely to be
63
higher than this.Thus ,ABN AMRO BANK can and must allocate
funds for financing the textile units to broad-base its advances
portfolio.
2) As regards assessing the technical viability of the textile
machines, the following institutions can be consulted :-
-Northern India Textile Research Organiation, Ghaziabad
-South India Textile Research Association (SITRA)
-Ahemdabad Textile’s Industries Research Association(ATIRA)
-Bombay Textiles Research Association (BTRA)
-IIT Delhi
-Technological Institute of Textiles, Bhiwani (TIT
3) The ABN AMRO BANK can start its full-fledged Textile
Finance Division with the following companies to target, which
are on the threshold of expansion :-
1. JCT Mills Phagwara, Punjab (Corporate Office, New Delhi
2. Ginni Filaments
3. Sangam India Ltd.
4. Birla Textile Mills
64
5. Abhishek Industries Ltd.
6. Alok Industries Ltd.
7. Rajasthan Spinning Ltd.
8. Banswara Syntex Ltd.
9. Shree Rajasthan Syntex Ltd.
10. Shri Bharwa Textile Mills,Banswara
11. Soma Textile Ltd.
12. Arun Processors Ltd.
13. Hissar Spinning Mills
14. KTTM
15. LMW
4) ABN AMRO Bank should concentrate on the textile units in
Northern India especially in Bhilwara, Banswara {Rajasthan},
Ludhiana (Punjab) Panipat, Faridabad (Haryana), Baddi, (HP)
besides other parts of the country e.g. Gujarat, Tamil Nadu,
Maharashtra and Madhya Pradesh/
5) The replacement demand for carding machines is generated
depending on the type of carding machines, for e.g. for old
carding machines it takes 3-4 years, whereas for new carding
65
machines it takes about 18-24 months, due to very high
volumes. So even if one new machine is replacing four old
cards, replacement is needed every 18 months. Generally mills
which are quality conscious, change cards at timely intervals
as this has a direct impact on the quality of the yarn.
Other machines have a life of around 10-15 years.
ABN AMRO BANK can focus its portfolio of advances by
targeting such units.
6) Regarding the perception of ABN AMRO BANK, the suppliers
responded that though their customers are not yet exposed
to the Bank, but they will certainly like to avail the financial
products of the bank provided they offer competitive interest
rates and prompt financing. The Bank should aggressively
target such companies through these suppliers, keeping in
view the impending bright prospects of the industry in national
/ international markets.
66
7) A recent loan proposal cleared by a leading bank to a
textile unit (M/s Birla Textile Mills, Baddi, Himachal Pradesh)
for its expansion programme under TUFS studied during the
research process, is given at Annexure A. It can be useful for
the ABN AMRO Bank in formulating a financing pattern for a
prospective borrower.
ANNEXURE
BIRLA TEXTILE MILLS , BADDI (HP)
Expansion Project - 28800 Spindles - 100% Grey Cotton Yarn
67
Summary of Machinery Requirement
Department
Tot
al Make
Ring Frame with Auto Doffers 24 LMW LR-6
(1200 Spindles )
Simplex Frame 10 LMW LF1660
Draw Frame with Auto leveller 10 RSB-851
Comber 20 LMW LK54
Lap Former 4 LMW LH10
Draw Frame 6 LMW DO-6
Card 30 LC-300A
68
Blow Room Chute Feed- Cotton 2 LMW
Bale Blucker 2 LMW
Autoconers with FF Channels 10 SAVIO OROIN-L
Cheese Winding-140 Drums 4 RJK/PEASS
T.F.O (VJ-150 HS-180 Spd.) 24 VEEJAY LAKSHMI
BIRLA TEXTILE MILLS, BADDI
Expansion Prioject - 28800 Spindles - 100% Grey Cotton Yarn
SPIN PLAN
COUNT 20/1 20/2 24/1 24/2 30/1 30/2 30/2 40/1 40/2 Tot
69
CH CH CH KH CH CH KH CH CH al
ACTUAL COUNT 20 20 24 24 30 30 30 40 40
NO. OF R/F 5 2 3 1 5 1 1 2 4 24
NO. OF
SPINDLES 6000 2400
360
0 1200
600
0
120
0
120
0
240
0 4800
288
00
(1200 SPD./
R/F)
SPINDLE SPEED
1600
0
1600
0
165
00
1650
0
180
00
180
00
175
00
175
00
1750
0
UTILISATION 98 98 98 98 98 98 98 98 98
TM 3.6 3.6 3.6 3.6 3.6 3.6 3.8 3.7 3.7
TPI 16.10 16.10
17.6
4 17.64
19.7
2
19.7
2
20.8
1
23.4
0 23.40
EFF. 88 88 89 89 90 90 90 92 92
GRAMS/SPD./
DAY 949 949 753 753 595 595 548 373 373
TOTAL
PROD/DAY 5583 2233
265
8 886
349
7 699 644 878 1757
188
35
LESS H.W 1% 5527 2211
263
1 877
346
2 692 638 870 1739
186
47
SPEED FRAME
70
(LFS-1660)
PROD
REQD/DAY 5697 2279
271
2 904
356
8 714 657 896 1793
192
20
ROVING HK 0.8 0.8 0.8 0.8 0.9 0.9 0.9 1.1 1.1
SPINDLE SPEED 1000 1000
100
0 1000
100
0
100
0
100
0
100
0 1000
TM 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.45 1.45
TPI 1.25 1.25 1.25 1.25 1.33 1.33 1.33 1.52 1.52
UTI & EFF. 85 85 85 85 85 85 85 85 85
PROD/SP/DAY
1842
4
1842
4
184
24
1842
4
154
41
154
41
154
41
110
33
1103
3
NO OF SP.
REQD 309 124 147 49 231 46 43 81 162
NO OF M/C
REQD 2.58 1.03 1.23 0.41 1.93 0.39 0.35 0.68 1.35 9.94
Say
10
DRAW FRAME
(FIN) (RSB-
851)
71
PROD
REQD/DAY 5755 2302
273
9 913
360
4 721 664 905 1811
194
14
SLIVER HANK 0.135 0.135
0.13
5 0.135
0.13
5
0.13
5
0.13
5
0.13
5 0.135
SPEED 400 400 400 350 400 400 350 400 400
PROD./DEL./
DAY
2013.
87
2013.
87
201
3.9
1762.
13
201
3.9
201
3.9
176
2.1
201
3.9
2013.
87
UTI & EFF 80 80 80 80 80 80 80 80 80
DEL REQD 2.86 1.14 1.36 0.52 1.79 0.36 0.38 0.45 0.90 9.8
D/F REQD 2.9 1.1 1.4 0.5 1.8 0.4 0.4 0.4 0.9 9.8
BIRLA TEXTILE MILLS , BADDI (HP)
Expansion Project - 28800 Spindles - 100% Grey Cotton Yarn
Pre-Operative Expenses
S.No
. Particulars Amount Amount
(Rs in
Lacs)
(Rs in
Lacs)
72
1 Interest during construction
500 Lacs for 8 months
400
0 8.33
1200 Lacs for 7 months
840
0 17.50
1600 Lacs for 6 months
960
0 20.00
1700 Lacs for 5 months
850
0 17.71
2200 Lacs for 4 months
880
0 18.33
1300 Lacs for 3 months
390
0 8.13 90
2 Salary for six months 22
3 Wages for four months 63
4
Travellling & other misc.
exp. 35
73
5 L/C Opening, EPCG License 25
6
Insurance during
construction 40
___
Total 275
BIRLA TEXTILE MILLS , BADDI (HP)
Expansion Project - 28800 Spindles - 100% Grey Cotton Yarn
Interest Calculation
74
(Rs. in Lacs)
Particulars
200
6-07
200
7-08
200
8-09
200
9-10
201
0-11
201
1-12
201
2-13
201
3-14
201
4-15
201
5-16
A
On Working
Capital 198 198 198 198 198 198 198 198 198 198
(@ 9%)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
(220
0)
B
On Term
Loan
(@ 2.50%) 213 213 209 198 183 162 137 105 69 27
(850
0)
(850
0)
(834
1)
(791
6)
(733
1)
(648
1)
(547
2)
(419
7)
(276
3)
(106
3)
G.Total 411 411 407 396 381 360 335 303 267 225
* Term Loan repayment in graded 32 quarterly installments
commencing after two year from Commercial Production.
ANNEXURE
75
Webliography:
www.indianindustry.com
www.txcindia.com
www.indianinfoline.com
www.crisil.com
www.rjkgroup.com
www.fibre2fashion.com
www.rediff.com
www.texmin.nic.in
www.texprocil.com
www.aepcindia.com
www.greenbusinesscentre.com
www.infomat.com
www.alibaba.com
www.lakshmimachineworks.com
76
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