Technocraft to plough in Rs 70 cr for expansion

Mumbai-based Technocraft Industries has embarked on a major expansion drive with an estimated capital outlay of Rs 70 crore. The company is targeting at increasing its exports. The company has planned an Initial Public Offering (IPO) to fund its expansion.

Technocrat is primarily into three sectors - drum closure, tubes and textiles, with all its industrial units located near Mumbai.

In its drum closure division, the company is upgrading its plant by incorporating new technology developed by the company. "It is the latest technology and the entire line of manufacturing will be upgraded," said S K Saraf, managing director, Technocrat Industries. The total investment marked for drum closure is Rs 19.58 crore.

"With the new technology, we expect to reduce the manufacturing costs by 15-18 per cent and with the costs down, we can venture into difficult markets such as China and the South East countries, where it is a highly competitive environment in terms of costs," said Saraf.

The company also has plans to increase its production of the scaffolding and tubes which are widely used in the construction industry. For this, an outlay of Rs 21.07 crore is planned.

"In the country, the real estate and construction sector is booming and we hope that there will be a huge potential for scaffoldings," reasoned Saraf. He further added,"Tubes are the commodity business. As they are not very profitable, we want to add value to make our products become more profitable."

Technocraft is setting up a cotton yarn mill with 27,640 spindles at an outlay of Rs 66.89 crore to produce finer counts, which will add to its already existing capacity of 35,904 spindles. Of this, Rs 13.37 crore will be funded through the proposed IPO and for the rest Rs 53.52 crore, the company has tied up with Bank of India through a rupee term loan.

"Our production will go up once our expansion plans are over. We hope that our exports will go up by 30-40 per cent," Saraf said.