Bombay Rayon Fashions Ltd has announced its plan to invest Rs 1,100 crore to set up 6-7 fabric and garment making units in Maharashtra.
When quizzed about the company’s plans, a company spokesperson told Indiaretailing: “After gauging the potential of Indian markets, we have strategically outlined huge retail expansions that include an investment of Rs 1,100 crore for setting up greenfield facilities in Maharashtra. The company also plans to make a domestic foray with its own brands.”
Of the investment announced, Rs 450 crore would go into yarn dyeing and weaving, Rs 450 crore for processing, and Rs 200 crore for garmenting facilities. The new units will push up the company’s fabric processing capacity by 500,000 metres per day (180 million metres per annum), and garment capacity by 100,000 per day (30 million units a year).
The greenfield facilities will come up at Tarapur, Islampur, Ichalkaranji, Latur, Nanded and Osmanabad. The company’s retail business will be set up under a wholly owned subsidiary, Bombay Rayon Fashions Retail. Further details will be worked out over the next few months, the spokesperson added.
It is learnt that the company plans to open around 25 stores in the first year of operations. The stores will be of 5,000-10,000 square feet each and targeted at men, women and children in the age group of 15-35 years, with an average selling price of Rs 500-1,000 per unit. Bombay Rayon will be the key vendor for this company and supply woven garments.
Meanwhile, the company is also in talks with a few global brands for India operations. “We plan to float joint ventures to bring international clothing brands into the country,” the spokesperson stated.
Managing Director Prashant Agarwal said, “We have also decided to set up an organic cotton unit in Nagpur.” The units will come up by September next year, with the first as early as in three months, Agarwal added. Notably, the Vidarbha region has seen a spate of suicides by farmers recently.
The company currently produces 150,000 metres of fabric and 100,000 garments per day, at its plants near Mumbai and in neighbouring Karnataka. The upcoming projects are estimated to create direct employment for about 32,000 people. Land for all the units will be allotted in state-run industrial complexes, state government officials said.
Agarwal said the company has already tied up Rs 700 crore of debt for the expansion, and will fund the rest through equity funds, a part of which was raised through a Rs 300 crore share issue to qualified institutional buyers in January.
– Vishnu Rageev R, Bangalore Bureau