Based on expectations of a healthy economic climate, Vardhman Textiles, one of India's largest integrated textile manufacturing companies, has raised its capital expenditure outlay for 2012-13 from 2011-12's Rs. 3.1 billion to Rs. 7.5 billion.
The company, which engages in manufacturing of fibre, yarn, sewing thread and fabrics, believes that cautious monitoring of volume growth would play a major part in boosting it revenue growth and subsequently earnings.
Vardhaman, a leading manufacturer and exporter of cotton yarn in India, has maintained a vigilant outlook for the yarn industry in its recently released annual report.
The company said yarn exports would be affected due to slowdown in demand owing to global economic slowdown. It said the revival in global demand would be one of the main factors that would ascertain the yarn industry's growth in next fiscal.
The company's annual report says cotton prices are likely to remain steady in the next fiscal.
There has been a 6.1 percent fall in average cotton prices over the past one year. Such reduction in prices coupled with a decision of maintaining low cotton inventory helped the company to ease its working capital concentration.
The inventory days at Vardhaman, considered to be one of the most efficiently managed companies, reduced from 160 days in 2010-11 to 121 days in 2011-12, which helped the company to save 60 revenue days costing around Rs. 22 billion.
Fibre2fashion News Desk - India
