Introduction :Flagship company of the Vardhaman Group incorporated in 1973 as Mahavir Spinning Mills Ltd (MSML).
25 manufacturing facilities across India.
26,000 + employees across the company and its subsidiaries.
Revenue Rs. 5587crs (31st March 2016.
Subsidiary Companies : VMT Spinning Company Ltd.
VTL Investments Ltd.
Vardhaman Yarns and Threads Limited.
Vardhaman Acrylics Ltd.
Vardhaman Nisshinbo Garments Company Ltd.
Associate Companies : Vardhaman Special Steels Ltd.
Vardhaman Spinning and General Mills Ltd.
(Vardhaman Holdings Ltd.)
Raw Materials : Raw Cotton, Yarn, Synthetic Fibre, Fabric, Dyes, Chemicals & Auxiliaries
Finished Products : Yarns & Speciality Yarn, Fabric, Sewing Thread, Acrylic Fibre, Garments
HR Strategies : Human Capital most Valued Assets
Rigorous Recruitment
Culture of continuous learning
In house and on the job training
Systematic appraisal for talent development
Encouraged informal mentorship
Training through premiere institutes (domestic and international)
Open and transparent top – down communication
Employee engagement and team building practices (QCT, GCM etc)
Employee stock options
Entirely home grown senior management
Marketing Strategies : Intensive market research both domestic and international.
Concentration on a niche market i.e. Five major textile products.
Long-term partnerships with key stakeholders i.e. customers, vendors and partners.
Innovative and specialised product development and diversification based on customer feedback.
Strategic international alliances to upgrade technology and endure global standard product quality.
Policy of sustainable strategic expansion.
Brexit, Demonetisation & Trump :
Brexit : The UK accounts for more than 25% of india’s textile and appral exports to the EU.
Not effect on Indian export tariff preference to the EU.
May provide opportunity for a FTA with Britain.
Short term negative implications expected.
Demonetization :
Slow down of domestic demand for textile end products immediately after note ban.
Securing raw material and selling finished goods to a hit.
Shot term slowdown in operations in large firms.
Delay in cotton exports.
Small cash dependent firms took a major hit.
President Trump : Scraping of the TPP.
Opportunities to India
Future Growth : Global environment supportive of growth in Indian Textiles
Indian textile expected to grow to US $470 Bn by 2025 – (Investment US $320 Bn)
Vardhaman Conservative growth strategy.
Retain manufacturing licences to A & E threads.
Consolidation, Specialize and expand the existing niche markets i.e. Yarns & Fabric.
One stop shop for fashion yarns and fabric.
Conclusion : Successful conservative expansion.
Enhanced product quality and FDI.
Focus and enhance USP to attain market leadership.
2. INDEX
• Introduction
• Top Milestones
• Main Raw Material & Finished Products
• Production Process
• HR Strategies
• Marketing Strategies
• Accounting Ratios
• Effects of (Brexit, Demonetisation & Trump)
• Future Growth
• Conclusion
3. Introduction: Indian Textile Industry
Indian Textile
Industry
11% of total
exports
Employs 100
million
Organized
&
Unorganized
5% of GDP
&
14% of IIP
Oldest
Growth
$223bn by
2021.
4. Introduction: Vardhaman Textile Ltd.
• Flagship company of the Vardhaman Group incorporated in 1973 as Mahavir Spinning Mills Ltd (MSML).
• 25 manufacturing facilities across India.
• 26,000 + employees across the company and its subsidiaries.
• Revenue Rs. 5587crs (31st March 2016).
Chairman: Shri Paul Oswal
Subsidiary Companies
• VMT Spinning Company Ltd.
• VTL Investments Ltd.
• Vardhaman Yarns and Threads Limited.
• Vardhaman Acrylics Ltd.
• Vardhaman Nisshinbo Garments Company Ltd.
Associate Companies
• Vardhaman Special Steels Ltd.
• Vardhaman Spinning and General Mills Ltd.
(Vardhaman Holdings Ltd.)
5. Major Milestones
1973 1976 1981 1982 1989 1991 1993 1995 1996 1999 2008 2009 2011
Incorporation of
MSML/Vardhama Textile
Ltd.
First 25,000 spindle capacity
unit set up Hoshiarpur,
Punjab.
Diversified into
manufacturing of
Sewing Threads.
100% export oriented unit
for cotton yarn set up in MP.
J/V Marubeni Corporation & Toho
Rayon Company Limited of Japan set
up VMT Spinning Company Ltd.
JV with Marubeni Corporation and
M/S Japan Exlan Company Limited
for setting up an Acrylic Fibre
project Vardhman Acrylics Ltd (VAL).
Entered into a J/V with M/S Barbour Campbell
Group Limited of Ireland set up Barbour
Vardhman Threads Limited (BVTL).
Brought entire stake in BVTL
renamed it Vardhman
Threads Ltd. (VTL).
Vardhman Yarns & Threads Ltd.
(VYTL) incorporated as a joint
venture with American & Efird (A&E).
Vardhman Nisshinbo Garments
Limited, a JV with Nisshinbo
Textiles Inc., Japan was set up
for manufacturing formal shirts.
Union Unrest
caused 6 +
month factory
shutdown.
Set up factory
in HP capacity
of 25000
spindles.
VSS demerge and VTXL
pure yarn and fabric.
8. HR Strategies
• Human Capital most Valued Assets
• Rigorous Recruitment
• Culture of continuous learning
• In house and on the job training
• Systematic appraisal for talent development
• Encouraged informal mentorship
• Training through premiere institutes (domestic and international)
• Open and transparent top – down communication
• Employee engagement and team building practices (QCT, GCM etc)
• Employee stock options
• Entirely home grown senior management.
9. Marketing Strategies
• Intensive market research both domestic and international.
• Concentration on a niche market i.e. Five major textile products.
• Long-term partnerships with key stakeholders i.e. customers, vendors and partners.
• Innovative and specialised product development and diversification based on customer feedback.
• Strategic international alliances to upgrade technology and endure global standard product quality.
• Policy of sustainable strategic expansion.
Sample of diversification of
Vardhaman’s yarn product line.
10. Accounting Ratios
Ratio Type 2016 2015 2014
Profit Volume Ratio 55% 49% 56%
ROCE 20.75% 15.87% 23.20%
Current Ratio 1.60:1 1.76:1 1.87:1
Debt Equity Ratio 0.28:1 0.42:1 0.67:1
Divident Payout Ratio 14.62:1 17.72:1 10.74:1
Vardhaman Ratio Analysis (3 Years)
11. Brexit, Demonetisation & Trump
Brexit:
• The UK accounts for more than
25% of india’s textile and
appral exports to the EU.
• Not effect on Indian export
tariff preference to the EU.
• May provide opportunity for a
FTA with Britain.
• Short term negative
implications expected.
Demonetization:
• Slow down of domestic
demand for textile end
products immediately after
note ban.
• Securing raw material and
selling finished goods to a hit.
• Shot term slowdown in
operations in large firms.
• Delay in cotton exports.
• Small cash dependent firms
took a major hit.
President Trump!:
• Scraping of the TPP.
• Opportunities to India.
12. • Global environment supportive of growth in Indian Textiles
• Indian textile expected to grow to US $470 Bn by 2025 – (Investment US $320 Bn)
• Vardhaman Conservative growth strategy.
• Retain manufacturing licences to A & E threads.
• Consolidation, Specialize and expand the existing niche markets i.e. Yarns & Fabric.
• One stop shop for fashion yarns and fabric.
Future Growth
13. • Successful conservative expansion.
• Enhanced product quality and FDI.
• Focus and enhance USP to attain market leadership.
Conclusion
