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‘China will give us volume’

In 1976, the first Two for One (TFO) Twister of Veejay Lakshmi Engineering Works rolled out of its engineering unit in Sengalipalayam, Coimbatore. In twenty-seven years, it has become a prominent name among the textile spinning fraternity, acquiring nearly 70 per cent of the market share in India. With resilience setting in the textile industry, the company is planning to augment presence in the international market, says Mr J Anand, managing director, Veejay Lakshmi, in an interview with Sudha Swaminathan.

How has Veejay Lakshmi maintained its tempo of growth?

Veejay Lakshmi has sold more than 3000 TFO twisters and has also emerged as a winner in the export market. Its quest for growth saw the company diversify into automatic cone winding machines in collaboration with Savio, Italy, a dominant player in the world market for automatic cone winders.

The company has also established a textile division with a capacity of 25,000 spindles, producing 300 tonnes of single yarn and 100 tonnes of twisted yarn per month. To meet the power requirements the company has its own windmills and electric power generation.

What has been the impact of Technology Upgradation Fund Scheme?

TUF Scheme has only a marginal impact. It was launched with a corpus fund of Rs 25,000 crore. But the take off is very minimal. Even after four and half years, the amount sanctioned stands at Rs 6,700 crore and the amount disbursed is Rs 4,900 crore. But I think many spinners have availed the scheme. While spinning and composite units have taken a substantial share in this, its percolation is very less in the unorganised sector of weaving and processing industry. The products we manufacture are included in the eligibility list and many of our customers have availed it.

You have been chosen for the TIFAC-Core assistance programme for new product development. What has been the outcome?

Considering the importance of our products for the textile industry, we were selected for the financial assistance. Two projects were taken by the company under the financial assistance (of Rs 580 lakh) from Technology Information and Forecasting and Assessment Council (TIFAC) of Government of India - one for development of a new model of two-for-one twisters and the other for indigenous development of components for the automatic cone winder. Both projects have been completed and the new model of TFO will be launched during the current year in the market.

Import duties on textile machinery is coming down and do you see international players coming to India. How will you keep up your position in the domestic market?

Import duties for our range of products are already down and hitherto there is no significant impact. New players may come as India is a big market. We have a market share of 70 per cent for TFO twisters and we offer superior product using advanced technology at competitive prices. We will constantly improve our technology to provide new products.

How is the market for your products?

Our fortunes depend upon the fortunes of the textile industry. Spinning mills, especially exporting units are increasingly going for TFO twisters and automatic coners to add value to yarn. Mills catering to the domestic market are also looking at value addition. More than expansion of spindle capacity mills are focusing on technology upgradation to improve quality. All this will improve the demand for TFO twisters and automatic cone winders. In fact our turnover from the textile machinery has increased from Rs 58 crore in 2001-02 to Rs 65 crore during 2002-03. In the current year, sales will be still higher at around Rs 80 crore.

Explain about your export experience?

We are exporting nearly 15 per cent of our production of TFO twisters. In the case of our automatic cone winding machines, it is 5-10 per cent. We are exporting to Indonesia, Thailand, Bangladesh, Nepal, Sri Lanka, Kenya etc. We are planning to increase our exports by exploring new markets. We are looking at China, Turkey, Egypt and Mexico. China will be our focus as the volume will be huge. We have already started negotiations with few mills in China. We have also developed a new product (TFO twisters) for the export market. However, we will not dilute our focus in the domestic market.