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| Morarjee Textiles to buy US, Italian brands |
MUMBAI: Morarjee Textiles is close to acquiring apparel brands in the US and Italy for about Rs 80 crore. The Rs 170 crore Mumbai-based company, part of the Ashok Piramal Group, plans to sew up the deals by July.
The company is also developing its own brands and private labels, which will be sold initially through Piramyd Retail stores.
This is part of a Rs 40 crore expansion plan, which also includes setting up of a 9mw captive power unit. Last year, the company had acquired 49% stake in Just Textiles for Rs 8 crore.
Textile analysts said the company's growth plan is part of an essential strategy to gain scale quickly in the branded space.Currently three-fourth of the company's garments and about 60% of its fabrics are exported.
Harsh Piramal, executive vice chairman, Morarjee Textiles, told DNA Money, "Negotiations are on with two reputed international brands in North America and Europe. We have earmarked around Rs 80 crore for the acquisitions."
Of the Rs 40 crore being spent on expansion, Rs 20 crore will be to expand garment making capacity from 4.5 lakh pieces per annum to 12 lakh pieces, while Rs 10 crore will go towards expansion of cloth printing facility from 11 million metres per annum to 15 million metres per annum.
The company has a subsidiary in Bangalore called Integra Apparels which is into readymade garments. The company also executes apparel outsourcing contracts for brands such as Prada, Allen Solly, Louise Phillipe, Zodiac, Van Heusen etc.
Morarjee Textiles has recorded an income of Rs 170 crore for the year ended March 2006, up 15% from the previous year.
This growth in revenue was on the back of additional growth in business from international operations, product mix, rationalisation and better realisations. The net profit for the year stood at Rs 10.45 crore, against Rs 6.64 crore last year.
Source: DNA, June 22, 2006
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