Eskay to implement Rs 350 crore expansion plan

Mumbai, Oct 4 (UNI) Eskay K'n'IT (India) Limited, the flagship company of Navin Kumar Tayal enterprise, is all set to implement a huge expansion plan involving Rs 350 crore.

The company, which has already invested Rs 70 crore in this direction, will execute this expansion programme for its spinning, knitting&processing capacities and manufacture of high-end fabrics in order to fulfil the vastly growing international demand for finished garments and apparels, said a company Press release here today.

The company will expand its existing spindles capacity by bringing in an additional 75,600 spindles to its plants located at Silvassa in Union Territory of Dadra and Nagar Haveli, Bhilad in Gujarat and Navi Mumbai. For the expansion, Rs 150 crore will be term loans and the rest Rs 200 crore will be through promoter's internal accruals.

As per the company's expansion plans, there will be a capacity addition of 13,184 tpa in knitting and 13,608 tpa in processing of textile fabrics once the expansion is in place. Initial production capacity of the garment facility will be 1,00,000 pieces per year in 2007 and subsequently increased to 2,00,000 pieces per annum. The company aims to complete its expansion plans by June 30 next year.

The Rs 357 crore net worth Eskay plans to introduce its own brand called League&Assets through multi-branded showrooms in the metro cities. The company, with a turnover of Rs 433 crore during last fiscal, also plans to export garments to major supply chains like Wal-Mart and Urgent Gear and to the US and European markets.

Eskay's expansion plans come at a time when new vistas have been opened up to the textile industry in India after the elimination of quota system. With this elimination of quantitative restrictions, the textile industry in the country is all set to take a leapfrog jump in its exports in the coming years.

The potential of growth in the textile industry can be gauged from the Indian government's export target in this sector. The Central Government has envisioned an ambitious export target of US Dollar 50 billion by the year 2010 against the present annual exports of over US Dollar 17 billion.

Eskay has registered a quantum jump in its unaudited quarterly results ended June 30 at a net profit of Rs 8.52 crores against Rs 2.64 crore of corresponding previous year.

UNI KKD PM SKB1804