Nakoda Textile Industries Ltd (NTIL) posted a robust 35 per cent growth in top line to touch 195.58 crore (YoY) for the second quarter ended June 30, 2008. The company’s EBITDA margin improved 98 basis points to 4.67 per cent as compared to the corresponding quarter last year. This was due to better realization on account of pricing and streamlining of the cost structure. Net profit (Profit after Tax) for Q2 CY08 was also up 56 % at 3.58 crore.

Commenting on the results Mr. B. G. Jain, CMD, NTIL, said “The capex that we have undertaken would provide us the requisite boost for sustainable growth in the future. Work on the capex is being accomplished as per schedule. We are confident of tripling our market share from the present 2 per cent in the POY business on completion of capex.

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About NTIL

Nakoda is ISO 9001-2000 company where quality management is a continuous process and a way of life. The company was incorporated in 1984 and initially commenced business with one texturising machine, with a capacity of 354 MT, at Silvassa. The company’s funding included a seed capital of Rs 5 lakhs from IDBI that used to be extended to technocrats.

In order to expand capacity, the company came out with its right-cum- public issue of fully convertible debentures of Rs 950 lakhs in 1992. The issue in which 12000 investors participated was oversubscribed by 7 times.

Backward Integration & diversification

In 1997, NTIL added four lines for manufacturing POY by importing machines from Taiwan. This project was financed with term loans from GIIC and GSFC and internal accruals. In 1999, the company picked up plant and machinery of Garware Nylons at Pune through an open auction of The Bombay High Court. Few years later NTIL acquired 2 POY lines from Indian Organic Chemicals Ltd. These initiatives helped them to reach the present capacity of 30000 MT POY.

In 2007, Nakoda added six lines to manufacture 19500 MT of fully drawn yarn (FDY) at its Karanj plant near Surat. The Rs. 26.75 crore project was funded by Rs. 18 crore term loan and the remaining came from internal accruals. Commercial production started in November 2007.

NTIL’s plants are strategically located at Karanj in Surat district and are better placed to cater to their customers who are texturisers. 95 per cent of India’s texturisers are located in South Gujarat and Silvassa. Nakoda caters to the small and medium texturisers. The company has a 3 per cent market share in the POY segment and 20 per cent share in the FDY segment. POY and FDY manufacturing is highly capital intensive and are manufactured in hi-tech plants. The company has a headcount of 200 out of which 90 are workers.

Sound Management Quality

The management team is driven by experienced hands. The CMD –Mr. BG Jain is an MBA, with 30 years of experience in the industry. Helping him in his endeavour is Mr. D.B.Jain, Jt MD is an MBA with 6 years experience in this line. Mr. B L Maheshwari a Chartered Accountant with 24 years of industry experience and Mr. SK Bhoan a technocrat with 36 years of experience are independent directors on the board.