With a humble foray into manufacturing with mono filament yarn in 1994, Filatex India Ltd has built its business brick by brick and today, it is a well-established player in Indian polyester filament yarn market with multiple ‘economy of scale’ manufacturing locations. The company is further expanding its manufacturing capacity to achieve product mix balance and value addition. Polyester being the most versatile synthetic fibre, Filatex India is poised for further growth in a market of tough competitors. Recently, Textile Excellence spoke to Madhu Sudhan Bhageria, Chairman and Managing Director, Filatex India Ltd., and here is an excerpt for our readers.
How is Filatex India maintaining a positive bottom line in spite of the tough competition in domestic as well as in international market?
Filatex India has been in the business of polyester filament yarn for several decades now and we always tried to understand the market trend in terms of customer’s preferences, cost scenarios, investment opportunities in the market. This has helped us to build capacities and competitiveness as well as to create value for investors.
Today, Filatex India has integrated operations which are of economy of scale capacities, well diversified product mix, state-of-the-art technology as well as vast domestic and global customer base. These factors bring certain advantages in terms of cost competitiveness and therefore, our products are globally competitive.
How do you see the future of polyester yarn industry in India? Looking at the rapid growth of this industry in India over the last two decades, do you see more room for growth?
Polyester is the most versatile of synthetic fibres and it is the most cost competitive fibre available for the industry. Considering that globally, growth of natural fibres is limited by available resources, it is only polyester which would see further capacity enhancement.
In India, we have several advantages for textile manufacturing; we have huge domestic market yet polyester consumption is still well below global average, petrochemical manufacturing base is very strong and manufacturing is yet very competitive compared to our competition. Also, polyester is used extensively in technical textiles sector and opens up new areas of application in our country. Therefore, Indian polyester yarn industry would keep growing as long as world has enough crude oil supply. In fact, Indian polyester fibre industry would rule the next two decades and would see substantial capacity growth.
However, this industry can thrive even better, if the taxation structure is streamlined. For example, one of the key raw materials – PTA has anti-dumping duty of around 15% while paraxylene (raw material of PTA) can be imported duty-free.
This is making our product uncompetitive if raw material is imported. Government must look into this area if they want this industry to grow faster. Also, I urge the government to shift polyester yarn making industry from Ministry of Chemicals & Fertilisers to Ministry of Textiles as industry should be categorised based on its output and usages. This would facilitate formulation of homogeneous policy for the entire textile industry. These minor adjustments can deliver profound growth of the polyester industry in India.
How are Filatex India’s expansion plans shaping up to tap the emerging opportunities?
I have already mentioned that we at Filatex India are always vying for opportunities to optimise product mix and value addition to meet our customer’s needs. Keeping that in mind, we are expanding and balancing our product mix at Dahej manufacturing complex with a capex of Rs 275 crore. The aim is to add further polymerisation capacity of 150 TPD (tons per day), Polyester POY capacity of around 170 TPD and DTY (Draw Texturised Yarn) capacity of 200 TPD. Polymerisation capacity would come on stream by mid-February 2019 while POY and DTY capacity should be commissioned by August and December respectively. This addition of capacity would help us to cater to our domestic and overseas customers optimally and uplift the topline beyond Rs 3000 crore. We could also expect a better bottom line due to lower operating cost and energy efficient operations.