Trident - Largest manufacturer of terry towels in the world - is it a worthwhile investment now

Expanding scale and reach. Incorporated in 1985 by Chairman Rajinder Gupta, the Trident Group today is one of the biggest yarn producers in India and the largest for terry towels globally. It has eight yarn units at Sanghera (Punjab) and Budni (MP), while the integrated Dhaula complex (Punjab) has three home-textile units, two paper units, chemicals and energy. The capacities have reached global scale – yarn (100,800tons), terry towel (360mn pieces), paper (450tpd) – thereby providing competitive edge in the commoditised sector. The customer base is highly diversified with MNCs in 75 countries across the globe, comprising 9 of the top 10 retailers in U.S., 6 leading retailers in Europe and 5 of the top 7 in Australia and New Zealand (ANZ).

After unveiling the world’s largest terry towel plant, the Trident Group aims to surpass the bounds of being the world’s largest integrated home textile manufacturer and continues to expand and modernize its capacities making it comparable with global standards.

The company already has its yarn manufacturing facilities at Sanghera in Punjab and Budhni in M.P. with a total of 3.66 lakh spindles and 3,584 rotors. The newly-commissioned plant at Budhni would further add 1,920 rotors to its existing capacity. With an investment of Rs. 60 crores for this expansion project, Trident has stepped forward towards the self-reliant manufacturing process.

Trident also commissioned an open-end yarn spinning expansion project in July 2014, with a capacity of nearly 10,000 TPA of cotton open-end yarn for meeting the yarn requirement for its terry towel unit in Budhni.

The company will make a total investment of Rs. 2,400 crores for its composite textile project and will engage over 25,000 families across all its business verticals. The project is completely vertically integrated, from cotton-to terry towel and from cotton to bed linen. Keeping pace with the technology, Trident has partnered with global suppliers like Karl Mayer, Toyota, Staubli, Benninger, Anglada, Muratec, LMW, Trutzschler, Oerlikon, Savio, etc., for its expansion and diversification plans.

 

In the textile space, I would rather prefer a company with a strong brand like Arvind, Page, RSWM, Kitex etc. Trident also looks like a decent choice due to its ambitious plans.

 

Also interesting developments with Welspun

Welspun India switches focus to domestic market for premium brand Spaces

New Delhi: Textile firm Welspun India has turned its focus from exports to the domestic market for its premium brand Spaces in bed and bath category. The company has recently appointed actress Parineeti Chopra as brand ambassador as part of its plan to increase revenue from Spaces to Rs 200 crore from Rs 125 crore achieved in the domestic market in 2014-15.
The company, part of the Rs 25,000 crore Welspun Group, whose Rs 5,000 crore turnover comes from textiles division, is taking steps to bring all its global collection under one umbrella of its own brands for India region.

"There is a lot of potential for innovative products in the country which consumers have never imagined but after creating awareness they feel the need for such products," said Subrata Pal, senior vice president, Welspun India.

The company sees huge potential in "performance-based" products, which has led it to invest Rs 75-100 crore in research and development every year. It has also tied up with various institutions such as MIT, Harvard and others in the United States and filed applications for 10-12 patents.

Products such as hydro bedsheet (which can control the temperature +- 5 degree in summers and winters), flexi fabric bedsheet (fabric which can fit to any size of the bed), or swift towel (which dries up to 30% faster) are some of the products that the company is betting on.

Besides its premium brand Spaces, Welspun also has the WelHome range for masses.

After investing heavily in product design, the next crucial step the company is planning is to focus on spreading its distribution channel network exponentially in order to reach out to tier 2-3 cities where it is still not present.

When asked about the competition from other players in the market, Pal said the home market will follow a similar trend as the apparel market where customers have shown a paradigm shift from the unorganised market to the organised.

"There is 10-15% market in branded home division, so we have competition with the unorganised market and not with the branded players," he said.

Welspun exports products to almost 50 countries and supplies to 14 global retailers such as Walmart, JCPenny, Target and Macy's.

 

@ Mr Pathak,@ Mr Carl. SPL INDUSTRIES is a micro cap,in ready made aparels ,supplier to many international brands,turnaround story as international demand is improving,with okey profit margin& debt laval.Members opnions is solicited .

 

Trident in my view is not a best play in textiles looking into financial health. But price movement I don't know.

 

Trident performance may go down from third quarters onwards and its competitor welspun may also face heat due to capacity glut by both componies?

 

Will hold it for now. Am +13% in one week