India's SVP Global Ventures to invest ₹100 cr in new tech textile unit

SVP Global will manufacture protective uniforms and functional garments, medical textile, mobiltech, hometech, anti-odour and antibacterial knitted fabric for sports, medical and cosmetic uses in apparel and expand gradually in other products, it said in a media release.

Technical textiles is a high-tech and innovation driven industry which is steadily gaining ground in India. Technical textiles are functional fabrics that have applications across various industries including automobiles, civil engineering, construction, agriculture, healthcare, industrial safety and waste management among others.

Commenting on the development, Chirag Pittie, director of SVP Global, said "Technical textiles industry is expected to be the next sunshine industry and it is expected to get much needed impetus from production linked incentives announced by government recently. Looking at the bright prospects for the industry, the Group decided to enter this field. The new facility is adjacent to our existing facility in Jhalawar (Rajasthan). The expansion will complement our core business and the plant is expected to start commercial operations in 12 to 15 months.”

On September 8, Central government had announced an incentive scheme for attracting private investments into the labour-intensive textiles sector including 10 technical textile products. Under the production-linked incentive scheme - the government will offer incentives of around ₹7,000 crore to man-made fibres and around ₹4,000 crore to technical textiles. An incentive of 3 per cent to 11 per cent of the annual incremental revenues for five years will be provided to existing as well as proposed investments in the sector. The industry is expected to see a quantum jump and could reach the size of $5 billion in the next 3-5 years.

Maj Gen OP Gulia, SM, VSM (retd), CEO of SVP Global, said, “Capex for the proposed green-field facility for technical textile is expected to be around ₹100 crore and will be funded from Internal accruals. Together with government support and bright prospects for the industry, we expect the forward integration will make significant contribution to the group’s topline and margins. We expect revenues of approximately ₹175 crore per year from technical textiles.”

Established in 1898, by Shri Vallabh Pittie, SVP Group is primarily engaged in manufacturing of polyester, polyester and cotton blend, and 100 per cent cotton yarn across 3 state-of-the-art manufacturing facilities in Jhalawar (Rajasthan), Ramnad (Coimbatore) and Sohar (Oman).

The Group recently commenced commercial operations at its mega textile plant in Oman. It has invested $150 million (around ₹1,100 crore) in setting up 1.5 lakh spindles and 3,500 rotors facility at Sohar Free Trade Zone in Oman. With the completion of expansion at Sohar, the total operational capacity of the company has increased to 4 lakh spindles and 5,900 rotors.

The company reported robust financials for Q1FY22 with net sales of ₹412 crore, growth of over 300 per cent Y-o-Y. EBITDA for Q1FY22 stands at ₹91 crore (EBITDA margin of 22.2 per cent) and net profit at ₹39 crore (PAT margin of 9.5 per cent). For FY21, company reported total income of ₹1,422 crore, EBITDA at ₹234 crore and PAT at ₹25 crore. The order book of the company currently stands at ₹5,000 crore, which is equivalent to next 2-3 years of revenue.

Fibre2Fashion News Desk (KD)