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Mafatlal chalks out plan to revive textile business
E-Tex Staff - Mumbai
Mafatlal Industries (MIL) has chalked out a revival
plan in its core textile business. The group has also constituted a three-member
team headed by former Bombay Dyeing executive director (ED), Mr P Malik to run
the new venture. Mr Malik has been designated as the chief executive officer
(CEO) of the new venture.
A senior company official confirmed that the group
was working on the project but added that this was at an initial stage. The
Rs 663.15 crore company is making a foray into the readymade garments business
with the launch of shirts. Industry sources said that the shirts would come
under the Mafatlal brand, scheduled to be launched this month. The company would
test-market the shirts through its dedicated outlets before going in for the
big launch. At present, the company has 30 dedicated outlets all over the country,
with a strong presence in Gujarat, said sources. The sources added that the
shirts would be mid-priced.
The company also plans to launch trousers at a later
stage. An analyst tracking the industry said the company has a good track record
in smaller towns and villages and enjoys strong brand loyalty in these areas.
The company now has a miniscule presence in the textile business. However, it
is only into fabrics under the Stanrose brand. The textile operations of the
company are currently undertaken at two units in Mumbai. The company has a garment
manufacturing unit at Nadiad and Kandla. The products from both these units
are exported. It was a depressing fall for the Arvind Mafatlal group, once worth
Rs 2,400 crore at its peak in 1994. It was then that the group decided to diversify
beyond the textiles business to include petrochemicals and financial services.
They even set up India’s first petrochemicals plant, National Organic Chemical
Industries (Nocil) in Thane. But costly business decision and stiff competition
led to its closure.
MIL, the group’s flagship and once one of India’s
best textile companies, was declared a sick company in September 2000. Two years
ago, the Board for Industrial and Financial Reconstruction (BIFR) sanctioned
a Rs 478.49 crore rehabilitation-cum-restructuring scheme for MIL. The company
is believed to be studying the implications of the scheme. The company reported
a Rs 14.49 crore net profit for the year ended September 2002. For the quarter
ended March 2003, the company reported a negative reserve of Rs 277.74 crore.
The group holds vast tracts of prime real estate in South Mumbai - Mafatlal
House, Mafatlal Centre and Mafatlal Chambers, which are situated in prime central
business district. It also owns land at Mazgaon near Mumbai’s dok lands.
The Mafatlals moved from trading in textiles to setting up their first textile
mill in Ahmedabad in 1905. This as the start of Mafatlal Industries. Over the
decades, they diversified, joining the ranks of India’s first families
of business.
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