Indorama to expand spandex facility with Rs 600 cr

Indorama Industries, part of USD 8 billion Singapore-based Indorama Corporation, on Tuesday announced an investment of Rs 600 crore to expand its spandex (a synthetic fibre) manufacturing facility in Himachal Pradesh on growing consumption by domestic spinning companies.

Indorama has set up the country's first spandex making plant at Baddi in Himachal Pradesh with an initial investment of Rs 400 crore. The plant was commissioned in March.
"We intend to scale up the capacity from 5,000 metric tonnes to 15,000 metric tonnes in 2-3 years and it will require a capital infusion of Rs 600 crore," Indorama Industries business head R D Gupta said in Chandigarh on Tuesday.
The company mainly caters to various Indian textile companies including Vardhman, Nahar, Arvind Mills as spandex has applications in making stretchable denim, sportswear and innerwear. Indorama sees consumption of spandex growing by 15%-20% per annum against global growth of 7%-8% while total market size stands at 6,000-7000 tonne per annum.
"Domestic spinning companies will now no longer depend on countries like China, Taiwan, Vietnam for meeting their requirement for spandex. Moreover, they will also be saved from losses incurred in currency fluctuations while importing spandex," he said.
The company will partly fund the expansion with money raised through USD 60-70 million of external commercial borrowings (ECB).
Indorama expects turnover of Rs 800 crore after expansion from its plant in Himachal Pradesh. "We anticipate sales of Rs 250-300 crore in 2012-13 and after expansion, the turnover is projected at Rs 800 crore," he said. Indorama Corporation is promoted by UK-based SP Lohia, and is a diversified group with 38 manufacturing facilities in 19 countries.