The commercial production is scheduled to commence on September 30, 2026, at the existing unit located at Block No. 372, NH-8, Moje Dhamdod, Near DGVCL Power Sub Station, Tal. Mangarol, Dist Surat – 394125.
Nature of the Event
The new line of business belongs to yarn manufacturing, specifically focusing on value-added manufacturing of denim garments such as jeans, jackets, and other apparel. This represents a forward integration of the Company's existing denim fabric manufacturing operations, moving up the value chain from fabric to finished products.
Strategic Rationale and Expected Benefits
The venture into polyester yarn manufacturing is described as a strategic move aimed at:
- Enhancing the Company's value proposition
- Improving profitability
- Ensuring long-term sustainability
Specific expected benefits include:
- Vertical integration of operations, converting in-house denim fabric into finished garments to improve margins
- Opportunity to tap into the growing apparel export market and attract global brands
- Potential to expand into B2C or D2C retail segments
- Utilization of existing manufacturing infrastructure and human resources
- Diversification of revenue streams, reducing the impact of fabric market fluctuations
- Support for the Company's ESG initiatives by incorporating sustainable garmenting practices
Financial Investment
Ricon Industries has invested approximately ₹25 crores as an initial capital outlay to cover machinery, skilled manpower, and infrastructure modifications.
Further investments are proposed to be funded through a mix of internal accruals and/or debt, as may be appropriate. The company remains flexible in its approach and will scale operations in alignment with demand and capacity utilization.