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Wednesday, June 07, 2006

Malwa group to bring out IPO of 2cr shares

Ludhiana-based Malwa Industries, a part of Rs 540-crore (Rs 5.40 billion) Malwa Group of companies, which is one of the leading players in the textile industry, will soon bring out an initial public offering, IPO, for 2 crore shares, reports Business Standard.

The Malwa group has varied interests in textiles ranging from cotton, yarn, denim, woollen garments and sewing thread

Apart from integrated operations in India, Malwa Industries has recently acquired a denim garment manufacturing facility in Jordan and also a denim garment finishing facility in Italy.

Rishi Oswal, chief executive officer and managing director, Malwa Industries said his company was a vertically integrated textile company, producing denim fabric and denim garments for Indian and international markets.

“We are coming out with an IPO for 2 crore shares in the current fiscal and we intend to raise market capital worth Rs 200 crore (Rs 2 billion) from it. Out of that money, Rs 60 crore (Rs 600 million) will be used for expansion purposes, Rs 50 crore (Rs 500 million) to pay off the debt of our Jordan and Italy plants, Rs 50 crore for working capital and Rs 28.5 crore (Rs 285 million) for setting up a 6 MW power plant where power will be generated from rice husk. This power plant will feed the entire complex and will start its production this July. Some of that money will also be used for acquisition of properties, as well as promotion of our own brands.”

The company’s installed capacity is 20 million meters per annum for denim fabric and 8.5 million pieces of denim garments comprising 4.5 million pieces per annum in India and 4 million pieces per annum in Jordan.

It also has high-end finishing capacity for 2.5 million pieces per annum in Italy. “The company plans to double the denim production capacity from 20 to 40 million meters per annum,” said Oswal.

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