Rubfila International Limited, a public limited company promoted by Rubpro of Malaysia and the Kerala State Industrial Development Corporation (KSIDC), is expanding its production capacity by 2500 tonne, which will take its total capacity to 8,850 tonne a year.
Speaking to Business Standard, K.Krishnakumar, managing director of Rubfila, said that the investment of Rs 15 crore for the expansion will be fully funded from internal accruals. The company is targeting a turnover of Rs 250 crore in the next two to three years.
Rubfila manufactures extruded round latex rubber thread at its production facility in the New Industrial Development Area at Kanjikode near Palakkad. The expansion will take place in the same premises. The new facility will be fully utilised for producing talc-coated rubber thread (TCR) which has good demand both locally and globally.
The company has purchased 12 acre in Tamil Nadu and this will be utilised for producing rubber and latex-based products, he said.
The production facility of Rubfila is designed to produce both TCR as well as silicon-coated rubber thread (SCR). The annual production capacity of this facility is 6,350 tonne. Rubfila is the only manufacturer of silicon-coated rubber threads in India.
Rubfila is the market leader in India in rubber threads and is also a leading exporter of the product from the country. It exports products to 25 countries, mainly to Italy, Germany, Japan, the US, Sri Lanka and Bangladesh. The company produces rubber threads for various applications like apparel, food packing, furniture webbing, bungee jumping, toys, medical netting, diapers and catheters.
The company ran into rough weathers during the course of time and started running at heavy losses and was referred to BIFR when the total net worth eroded.
In 2005, a new group of investors led by Bharat Patel stepped in as promoters. All the liabilities of the banks were negotiated and settled by bringing in additional funds. A new management team was also put in place to lead the company out of troubles.
Rubfila has started improving its turnover and profitability under the new leadership. The net worth of the company has turned positive in the year 2011-12. The capital of the company has been restructured to Rs 21.61 crore from the earlier Rs 31.68 Crore.
The promoters had converted the loan into shares, thereby increasing their holding to 64.11 per cent from 38.87 per cent. The company, which suffered a net loss of Rs 7.12 crore in 2008, has cloaked a net profit of Rs 2.77 crore in 2011 under the new management. In 2011-12, the company has earned a net profit of Rs 9.93 crore with a total turnover of Rs 101.83 crore.
The company has started coming out of the red from March 2010 and now has an earnings per share (EPS) of Rs 2.30. During the financial year ending 2012, it has achieved a 23 per cent increase in its turnover to Rs 101.83 crore, as compared to Rs. 82.47 crore in 2011. The profitability also showed a massive jump of 385 per cent to Rs 9.93 crore, as against Rs 2.15 crore in the previous fiscal.
