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SVP Global starts operations at textile plant in Oman

Aug 18, 2021
SVP Global starts operations at textile plant in Oman

Mumbai

India's largest compact cotton yarn manufacturer SVP Group, through its subsidiary SV Pittie Sohar Textiles (FZC), has commenced commercial operations at its mega textile plant in Oman. The group has invested $ 150 million (around Rs 11 billion) to set up 1.5 lakh spindles and 3,500 rotors facility at Sohar Free Trade Zone (SFTZ) in Oman. The plant is expected to reach peak utilisation by September 2021 and expected to contribute hugely in overall revenue of the company. 

Established in 1898, by Shri Vallabh Pittie, SVP Group is primarily engaged in manufacturing of polyester, polyester & cotton blend, and 100% cotton yarn across 3 state-of-the-art manufacturing facilities in Jhalawar (Rajasthan), Ramnad (Coimbatore) and Sohar (Oman). The company has a vision to become a world-leading, fully integrated textile company in manufacturing yarn, fabric and garments.

Commenting on the development, Chirag Pittie, Director, SVP Group, said, "The expansion of Oman plant consisting of 150,000 spindles and 3,500 rotors has been successfully completed and is expected to fully contribute to the financial performance starting September 2021. The strong demand for high margin combed compact cotton yarn coupled with sales off-take agreements will enable us to fully utilise the new capacities and enhance value for our stakeholders. We have a vision to be a leading integrated textile manufacturer of the world."

SVP Group expansion at Sohar Free Trade Zone in Oman offers many strategic operational and logistics benefits over a long period of time. In addition to 25 years corporate tax holiday, it offers 100% foreign ownership, low cost of capital and less power cost. Power cost is 40% less compared to the home market in India. Oman also has Free Trade Agreements with the USA, Turkey and many other countries. Additionally, it offers zero percent import or re-export duties. 

With the completion of expansion at Sohar, the total operational capacity of the company has increased to 4 lakh spindles and 5,900 rotors.

Maj Gen O P Gulia, SM, VSM (retd), CEO of the SVP Group, said, “Our manufacturing facilities are operating at near peak capacity and the Oman facility is planned to reach peak utilisation by September 2021. Our strategic growth initiatives, enhanced capacity and operational efficiencies, product and geographical expansion with focus on high margin products are likely to drive profitability and contribute to the growth of the company. The Group is now ready to foray into the complete value chain of textile. The order book of the company currently stands at Rs 50 billion equivalent to next 2-3 years of revenue."

SVP Group has reported robust financials for the Q1FY22. For the Q1 ended June 2021, SVP Global Net sales of Rs 4.12 billion, growth of over 300% Y-o-Y. EBITDA for Q1FY22 stands at Rs 0.91 billion (EBITDA Margin of 22.2%) and net profit at Rs 0.39 billion (PAT Margin of 9.5%).  For FY21, company reported total income of Rs 14.22 billion, EBITDA at Rs 2.34 billion and PAT at Rs 0.25 billion.

SVP Global claims to be among top 2% Indian manufacturers with technology less than 5 years old and output of 153-154 grams per spindle per shift, which is highest in the industry. The company's manufacturing facilities are equipped with latest technology automated machinery equipped with AI and IOT capabilities from blow room to windling. SVP Global is accredited as an approved supplier for leading brands including IKEA and Zara.