National Textile Corporation (NTC) has drawn up a consolidation plan that will increase the production capacity while bringing down the number of textile mills that it operates.
Chairman and Managing Director of NTC K. Ramachandran Pillai told The Hindu here on Wednesday that the proposal, if approved by the Union Government and the Board for Industrial and Financial Reconstruction, would see about Rs.1,500 crore investment for increasing capacity and having modern manufacturing facilities.
Nearly 10 years ago, the NTC had 119 textile mills. It embarked on a modernisation and revival plan in 2002-03 and brought down the number of mills to 23. It at present has eight lakh spindles in 23 mills, including five composite units.
Mr. Pillai said that the corporation expected Rs.1,000 crore turnover in 2012-13 as against Rs.690 crore in the previous year. Yarn and fabric exports this year had crossed Rs.100 crore.
Though many of its mills were making cash profit and the corporation had adequate cash reserve, the mills need to make net profit consistently.
“The NTC completed modernisation three years ago. Now, there are problems such as power and labour shortage. To be viable we need to have large number of spindles under one roof,” he said.
For instance, in Tamil Nadu, the mills were able to realise just 80 per cent capacity utilisation because of power shortage. Hence, the corporation was going in for 25 MW installed wind energy capacity in the State. Under the consolidation plan, it planned to close down three mills in Coimbatore city and have a greenfield project for one lakh spindles with a power plant at the Coimbatore Spinning and Weaving Mills premises. Similarly, it planned to close down three mills in Maharashtra and have a new one lakh spindles project at Amravati. It was also expanding the capacity of five textile mills.
The project would increase the total number of spindles to 10 lakh.
The corporation expected the approvals in two or three months. It also planned to add 100 new retail outlets in a year, he said.