Raymond in JV with Italian firm

Textiles and apparel major Raymonds today announced a joint venture with Lanficio Fedora of Italy to manufacture woollen products.

Gautam Singhania, chairman and managing director, Raymonds, said: "The new venture would be called Raymond-Fedora and we would be partnering to manufacture carded woollen products for the international market."

Singhania said that the total cost of the project was Rs 40 crore for the first phase of operations and it is a 50:50 partnership between Raymonds and its Italian counterpart.

Raymonds stock today gained 3.19 per cent to close at Rs 351 on Bombay Stock Exchange. This is the second overseas venture of the company announced over the last five months.

In February, it had entered into a Rs 180 crore equal joint venture with another

Italy-based company Cotonificio Honeggar, part of the Gruppo Zambiati, for manufacturing and marketing value-added cotton shirting fabric.

The company is expecting the new operations to begin in Maharashtra by January 2006. Raymond's existing carded woollen unit, that largely makes shawls and blankets in Maharashtra had a turnover of Rs 17 crore last year.

The unit had a low utilisation capacity. This unit would now be transferred to the new joint venture.

Singhania said this partnership would help Raymonds to enhance its current manufacturing capacity from 15 lakh per metres per annum to 25 lakh metres per annum in the first phase considering that two thirds of the product would be exported to fashion brands across the world.

Though global estimates for woollen products are not available, company officials say that India is emerging as an important outsourcing base for manufacturing carded woollen products.

In India, the demand for woollen products comes primarily from the Northern and North Eastern parts where jackets, shawls and blankets are in demand.

Singhania hoped to leverage on the strength of the international brand and create a new line of business for the company.