Filatex to deliver additional revenues of Rs 600 cr on fully capacity utilisation
Mumbai: Filatex India, a leading polyester yarn player is going to emerge as large player in the industry after expanding its current capacity from 3.28 lakh MT per annum to 3.90 lakh MT by investing Rs 275 crore. This would amount to 1050 Tons per day production capacity. After this company would emerge as fourth largest player in the sector.
The company has invested in expanding the capacity last year from 2.37 lakh MT per annum to 3.28 lakh MT in FY18. Company’s profits have been growing at a CAGR of 84 per cent in the last three years.
Currently exports contributes to 20 per cent of overall revenues. Polyester yarn demand is growing year on year basis on account of increased demand for apparels, women wear and under garments, home textiles & furnishings and sportswear.
The new capacity is coming at Dahej and the orders for machinery have been placed and the project is on track and will be operational in FY20.
As power cost is one of the major costs of production in polyester yarn, the company is setting captive power plant of 31.40 MW with a capital expenditure of Rs 145 crore at Dahej, which should be operational by FY 21. The current EBIDTA margins of Filatex stands at 9 per cent and is expecting to go up to 12 per cent after the commissioning of new power plant at Dahej. This will increase profitability of the company.
“Polyester is the fiber of future and will continue to expand our capacity based on the demand. The demand for polyester fiber is increasing as the demand for athlesiure, sports & yoga wear is increasing across the world,” said Madhu Sudhan Bhageria, Chairman & Managing Director, and Filatex India.
He further added that, “On the other hand the cultivation of cotton across the world is reducing, which is also increasing the demand for manmade fiber polyester yarn”
The demand for polyester yarn is increasing from both domestic and international demand. Company currently exports to 40 countries and experiencing good demand from countries like Brazil, Bangladesh and Eygpt.
Currently China supplies 75 per cent of the polyester yarn required for the world and Indian product stands at 10 to 11 per cent of the world demand. World demand for polyester yarn stands at 70,000 MT per day. As the labour costs in China is increasing the production capacities have started moving to India. The moment will increase in the coming years to come.
