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BTPL is ramping up production to meet global scale

May 01, 2021
BTPL is ramping up production to meet global scale

BRFL Textiles Pvt Ltd (BTPL), which is engaged in processing a wide range of fabrics, was recently in the news for setting a new benchmark in sustainability by introducing a new sulphur dyeing process by continuous dyeing method that does not require water. BTPL was formed as a separate entity in August 2020 as part of a restructuring process undertaken by Bombay Rayon Fashions Ltd, in which it hived-off its Yarn Dyeing & Fabric Processing units located in Tarapur into BTPL. In this interview with Rakesh Rao, Prashant Agrawal, Managing Director, BRFL Textiles, talks about how the company is strategising growth in this difficult market condition and trends in the industry.

How do you see the performance of BRFL Textiles Pvt Ltd since it was established as a separate entity in August 2020?

BRFL Textiles Pvt Ltd (BTPL) was set up as a new entity in August 2020. However, this shell company acquired the Tarapur fabric processing business from its parent entity only in Nov-Dec 2020 on a slum sale basis along with all associated brands, employees, assets, etc. BTPL then raised private equity funding, which came in only in the last week of December 2020. Since the funding, in just three months of operations, the company has ramped up its production significantly to reach 40% utilisation levels, despite these tough market conditions. We have brought new talent across departments, initiated various measures to be prepared for our next stage of growth and have far exceeded our internally set financial budgets for this period.

Recently, BRFL raised Rs 2.4 billion from financial institutions. What is the significance of this move?

This funding was raised in order to help us in making certain capital expenditures and maintenance expenses towards our state-of-the-art machineries and, primarily, to provide for working capital to support our aggressive production ramp up plans. Also, we have utilised this funding to add to the technology side of our operations.

In the current volatile market conditions, what are the business priorities for BTPL? How are you strategising growth in this difficult situation? 

Firstly, given the fresh equity capital raised and with almost no debt on our books, we are relatively in a stable state to compete in the market vis-à-vis our peers. Secondly, at BTPL, we always focus on high value-added design-centric products and hence, in this tough market of rising prices of various raw materials, we are still able to absorb these costs by bringing in more value additive products to compensate for lower volumes. Thirdly, and most importantly, we are a customer-centric company and, hence, rather than chasing growth we have been advising our customers to play safely in this volatile market. This approach of standing by the customer in difficult times has in turn given us more business from our customers as they are confident of us meeting their expectations and commitments. Our growth is coming primarily from increasing wallet share of our current and past customers.

BTPL's Tarapur plant processes a wide range of fabrics. How are you able to process multi-fibre fabrics in this single unit? What are the advantages of the same?

The advanced technology stack at our plant complemented with the skilled manpower enables us to process multi-fibre fabrics at our Tarapur unit. The plant was set-up in the first place keeping in mind about the fast-changing fashion needs of our clients, which revolves around multiple fibres. This ability helps us to cater to the dynamic demand of leading retailers of the fashion industry in terms of product, design, quality, speed and pricing. The biggest advantage is greater flexibility in terms of product offerings at various price points and rapid responsiveness.

While India's textile exports have been stagnant for the last few years, other Asian countries like Bangladesh and Vietnam have been able to increase their global market share during these years. What is plaguing the export growth of Indian textile industry? What are probable solutions?

Some of the hurdles limiting the export potential of the Indian textile industry are:

·         Large labour force with lower productivity

·         Fragmented knitted garments industry with no advantage of economies of scale

·         Technology obsolescence

·         Lack of Free Trade Agreements / Pacts

·         Relatively unfavourable labour laws

·         Poor infrastructure and credit constraints

The probable solutions to counter the above hurdles could be:

·         Continuous training and skill development of our workforce

·         Removal of cap under the TUF scheme for large scale units

·         Introduction of technology upgradation schemes

·         Government initiatives for Free Trade Agreements

·         Relaxation of labour laws and ease of credit constraints for exporters

·         Improve infrastructure network to streamline the textiles industry’s input procurement process

To boost local textile production, the Government of India has announced a slew of schemes like textile parks, Production-Linked Incentive (PLI) scheme for manmade fibre and technical textiles. Will this help Indian textile industry to increase exports?

It will help manmade fibre and technical textiles both. The Textile Parks and PLI schemes by the Indian Government are visionary and transformative initiatives. These will help in overcoming the lack of scale by attracting large investments and making the Indian textiles industry globally competitive and, they will also generate lot of employment.

Historically, the Indian policies have been biased towards cotton dominated value chain. Now the Government of India has come up with this well-thought-through PLI scheme to boost export of manmade fibre, which makes up for 65%-70% global demand.

Is Indian textile industry in a position to take advantage of the ‘China Plus One’ strategy adopted by global majors? How is BTPL gearing up to tap this opportunity?

While India has already started to benefit from the ‘China Pus One’ strategy adopted by global majors and will continue to benefit but it is a tall mountain to climb. Though in ease of doing business, India has quickly moved up to 63rd position but still it is far below China.

India needs to adopt a multi-pronged approach to scale up the manufacturing sector including labour reforms, improving logistics infrastructure (domestic level as well as international connectivity), free trade agreements, technological upgradation and production linked incentive schemes, land reforms, improving contract enforcements, etc.

However, the Government of India is swiftly working on all these fronts to grab this opportunity created by ‘China Plus One’.

For BTPL to capture this opportunity, we are continuously ramping up the production to meet the global scale requirements under the ‘Make In India’ plans.

What are emerging trends in dyeing, printing, processing, and finishing techniques?

The key emerging trend is sustainable dyeing or printing techniques like minimum usage of water and energy, reduction in chemical consumption and no pollution load. Other key trends include, usage of metallic colours and performance finishing like anti-microbial, temperature regulating, easy care, nano coating, etc. At BTPL, we are well positioned to capture most of these trends along with being the torchbearers of sustainability benchmarks in India and globally.

What are the growth plans?

As mentioned, our growth is essentially coming from the same set of customers with increasing wallet share as well as winning back old customers. We are looking at expanding to reach full capacity over the next two years. We don’t see much change in our mix of fabric or target markets going forward except that our B2C share will increase from here on.