Arvind Mills changes name and strategy
12/05/2008
India-based textile manufacturer Arvind Mills is to transform itself from a pure fabric and apparel solutions company to a diversified business group with a focus on branded apparel and apparel retail. It has also changed its name on the Bombay Stock Exchange to Arvind Ltd.
The company expects revenues from its branded apparel business to be approximately Rs7 billion ($168.5 million) in the next two years. Its apparel retail business will be split into two sections, luxury and value.
It is anticipating a 40% compound annual growth rate in the brands business driven by revenues from new brands such as Polo, Izod and Hartmarx and a 40% growth in its joint venture business.Despite negative factors such as the current downturn in denim, rising cotton and fuel prices and the appreciating rupee, its fabric business continues to generate positive cash accruals. The garment business is witnessing improved price realisation and volume growth as well as profitability improvements due to productivity gains and will continue to add value to the textile business.
It is targeting an eightfold increase in revenue for its value retail sector with revenues expected to reach Rs10 billion in three years. Retail space will be spread over 1.9 million square feet with 270 doors. The company plans to open 30 large format stores in 21 cities over the next five years.
It is to realign its product portfolio and marketing approach from the existing model. In the domestic market the company is to evolve a direct fabric retailing initiative to target premium customers. In the larger industrial segment it will focus on servicing the performance wear, work wear and industrial application fabrics.
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