Indus Fila to hike capacity

Bangalore-based apparel exporter and textile firm Indus Fila plans to raise $50 million to enhance its production capacity apart from acquiring a European clothing brand.

The company, which clocked Rs 269 crore in revenues last fiscal, plans to raise the funds through equity and debt.

"We want to raise the funds in two to three tranches depending on how the proceedings take place. It will go towards expanding our existing factories in Nanjangud. We are also eyeing to acquire a European apparel brand, which we plan to bring to India," Indus Fila Managing Director Nitin Mandhana told Business Standard.

At present, the company produces 65,000 metre of textile fabric per day. "We will raise the capacity to 165,000 metres per day. There is a lot of scope to scale up the business. We will also increase the number of apparel sewing machines from the existing 4,000 machines to 5,000 machines in the next three months," he added.

Indus Fila plans to foray into apparel retailing too. "All these years, we have been supplying ready-to-wear apparel to global and Indian brands. We feel it is time we had our own brand. We are looking at a couple of European brands. We are still in the discussion stage. We expect to finalise the deal in the coming months," Mandhana said.

The European brands the company is targeting include all categories of apparel products. "We want to market the acquired brand in India since the domestic retail market is fast-growing," he noted.

The funding will also go towards augmenting power supply to the Nanjangud factory. "We have a 6 Mw cogeneration plant at Nanjangud. The power generation capacity will be increased to 10 Mw," Mandhana stated.

The company earns 38 per cent of its revenues from exports with the balance coming from its domestic operations. It supplies apparel to international brands such as Mexx, Armani, Levi's, Nike, Tommy Hilfiger, Philip Van Heusen, Haggar and Wal-Mart. During Q3 2007-08, the company's net profit stood at Rs 11.6 crore.

Last year, Indus Fila Ltd had acquired a 51 per cent stake in Indus Garments (India) Ltd for Rs 9.3 crore.