First phase of new production unit commissioned
By K. Gopalakrishnan
Arvind PD Glass Composites Pvt. Ltd., a joint venture company set up by India’s leading textiles company Arvind Ltd. and Germany’s PD FibreGlass Group, recently commissioned the first phase of its production facility to manufacture glass fabrics at Santej, in Ahmedabad. The JV facility will cater to the requirements of a cross-section of industries like automobile & transportation, wind energy, aerospace and infrastructure amongst others.
The joint venture, Arvind PD Glass Composites Pvt. Ltd., will have 51:49 equity participation from Arvind Ltd. and the PD Group respectively. A total investment of Rs. 80 crores over the next three years is planned for this initiative. The goal of the facility would be to reach 30,000 MT per year of glass fabrics in the medium term.
Mr. Sanjay Lalbhai, Chairman and Managing Director, Arvind Ltd., said: “With the commissioning of this new facility, we have taken a major step forward in our long-term strategy to develop the technical textiles business as a major growth engine for Arvind Ltd. in the coming decade. Over the next two to three years we expect this JV to post revenues in the range of Rs. 150 to 200 crores with a significant share coming from exports.”
The PD FibreGlass Group looks back at more than 50 years in the fibre glass manufacturing and processing industry. This experience enables it to offer its customers a complete range of fibreglass products, from fibre production and processing to coating textile fibreglass structures, and all from a single source.
Mr. Stefan Preiss-Daimler, Managing Director, PD FibreGlass Group, said: “This new facility in India will become an important hub for supplying glass fabrics globally, especially in Asia. India is one of the fastest growing economies in the world, and we expect a big spurt in demand for glass fabrics.”
The new facility will manufacture woven uni-directional and multi-axial glass fabrics along with stitched and combo-mat glass fabrics. A big portion of the new company’s output will be marketed overseas.
The global market size for glass fabrics is estimated at $3 billion and is likely to grow at 6-8 per cent over the next five years. India currently is a small market for glass fabrics, estimated at Rs. 800-1,000 crores. However, as the Indian auto, wind energy, infrastructure and aerospace sectors grow; the demand is expected to grow at over 15-17 per cent per annum. Wind energy is the sector that currently consumes the highest volumes of glass fabric and represents 26 per cent of the overall market, followed by the transportation sector, which represents 16 per cent of the market size.
Advanced Materials Division
The Arvind Group is not new to the technical textiles business. A few years back the company created the Advanced Materials Division (AMD) fully dedicated to the field of high end performance materials and fabric solutions for composites. The company’s branded fabrics and composite textiles include solutions for growing industrial sectors like personal protection, industrial filtration, wind energy, Defence, auto components, transportation, and housing & infrastructure.
In a short span of time, Arvind has established itself as the largest fire protection fabric producer in India. The Arvind range of fire-resistant fabrics consists of meta-aramids, modacrylics, FR viscose and blends. The company has been licenced to manufacture and market the PROBAN brand of flame-retardant fabrics and industrial clothing in select 16 countries in Asia Pacific, including India.
Arvind has activated the Jacquard weaving facility to manufacture FR curtains and FR upholstery for the mass transport industry such as Railways and civil aviation. Arvind also manufactures multi-filament filtration fabrics. It has secured supply arrangement with a world leader in filtration industry. It has further diversified into manufacturing anti-ballistic fabrics. These are used for manufacturing bullet-proof vests and helmets. The company also offers a range of nylon fabrics for defence applications.
Interview with Punit Lalbhai
We spoke to Mr. Punit Lalbhai, the GenNext at Arvind Group, who has been given the mantle to grow the technical textiles business. He spoke about Arvind’s presence in the technical textile segment, opportunities that the new JV offers and the future growth plans for this segment.
Question: Why technical textiles?
Answer: If you look at Arvind’s current business portfolio its primarily fashion driven, which has its own ups and downs owing to the cyclical nature of the business. We have no doubt the Indian textile industry has a great future for the next 20 years, but then how do you ensure stable, long-term future growth for the company? We started exploring opportunities in related segment, and it was clear that technical textiles is an allied space for Arvind. Essentially we are trying to create a growth engine for the future that balances our portfolio, one that is IP driven and hence has entry barrier and one that doesn’t get commoditised. Technical textiles cater to industries that would witness exponential growth in the future. Consumption of technical textiles in developed economies is huge. Technical textiles business will ride on the India growth story, and we see this as the growth engine for the future.
Q: Why did you choose PD Group as your partner for the venture?
A: In any joint venture, it is important to have a partner who shares the same philosophy and the willingness to work closely. That chemistry needs to be there from a relationship standpoint and from a technology standpoint, which we feel strongly with the PD Group. PD is a technology driven high quality niche player which is also privately owned but at the same time very agile and can take quick decisions. They have been in the business for over 50 years and have some great products which are amongst the best in the world. They were looking to enter India and fitted very well with the kind of companies that we were looking for.
Q: Which are the industry verticals and product segments that you are targeting through the JV?
A: The Indian market is currently very small for fibre glass business. We want to play a leading role along with the other existing players in developing this market and creating demand. The main drivers for the products that we plan to manufacture would be wind energy and there are other major applications like transport segment, which includes bus bodies, metro rail cars and high-end automobiles. PD Group particularly has a very strong positioning in these segments. We are planning to use their expertise as we see an opportunity for future growth in India in these segments.
Q: What is the market size for these segments in India?
A: For the segments that we are targeting to cater to, the market size in India is currently around Rs. 800-1,000 crores. A large part of our business would initially come from overseas markets. We will leverage on the PD Group’s network and also on our strengths by building marketing teams in key locations. Initially the business will be more export driven, and as the Indian market matures we will start catering to the demand in the domestic market. PD Group will also source products from the Indian JV.
Q: What are the investments planned and capacities built?
A: We have planned to invest Rs. 80 crores in the first phase. We will need an investment of Rs. 150 crores to reach the targeted 30,000 metric tonnes capacity level. India currently has a capacity of 100,000 tonnes of fibre glass.
Q: How is Arvind’s presence in the technical textiles segment?
A: Fibre glass is one of the three segments within the Technical Textiles portfolio that we are present. We are one of the largest manufacturers of protective wear for fire-retardant applications. It was the first step for us in technical textiles as there were a lot of common aspects in whole manufacturing process. This business is growing and is expected to grow faster as there is greater focus on health and safety in countries like India. We also have capabilities to manufacture anti- ballistic bullet proof fabrics, high visibility and anti-static fabrics.
Another important component of our technical textiles business is flitration fabrics for industrial segments like oil and gas, food, chemical industries, agri and many others. We are also looking at expanding into conveyor belts, heavy rubber coated belts and light weight conveyor belts. Finally, we are also looking at opportunities in coating substrates like coated weather-resistant fabrics for outdoor applications.
Q: What are your targets for the Technical Textile Business?
A: We have just made an entry into the field of technical textiles. We have a lot of work to do to make each of these businesses large and meaningful. Our short-term goal is to achieve a turnover of Rs. 500 crores from Technical Textiles in the next 3 to 4 years. This business has a longer gestation period. A lot of effort goes into product development, testing and approvals. It’s a huge responsibility and a very exciting experience as well.
Karl Mayer’s state-of-art machine for Arvind-PD JV
Karl Mayer Textilmaschinenfabric GmbH, world’s leading textile machinery manufacturer, and A.T.E. Enterprises Private Ltd. have been partnering in the Indian textile industry for over five decades. Several projects have already been set up together for weaving and warp knitting operations in India.
Acknowledging the growing importance of technical textiles in India, Karl Mayer has taken the initiative to promote joint venture partnership with the leading Indian textile entrepreneur, Arvind Ltd. Initially Karl Mayer supplied its state-of-the-art “Opt-O-Matic”, a sectional warping machine to Arvind for its newly-started technical textile unit called “Advance Material Division”.
After the visit of Mr. Fritz Mayer, CMD of Karl Mayer, to Arvind Ltd. and his meeting with Mr. Sanjay Lalbhai, CMD, in September 2010, work on their proposed glass fabric manufacturing project gathered momentum in real terms. Karl Mayer, with its influence in the field of glass composites, then introduced one of the major European glass roving manufacturers, Preiss Daimler (PD Glass), to Arvind. After subsequent meetings and interactions, the JV for the project was announced by Arvind in December 2011.
Karl Mayer, as a technology provider, supplied its “Multiaxial” machine which has already been commissioned. The project was inaugurated on August 30, 2012. The unit has plans to scale up the production capacity from the current 5,000 MT to 30,000 MT and will supply to manufacturers of wind blades, yachts, small boats and automotives in both domestic and export markets.
Mr. Nitin Bavkar, Director, Dornier Machinery India Pvt. Ltd.
We have supplied 3 DORNIER Rapier Weaving Machines for Arvind-PD Composites for weaving glass fabric using glass roving of 600 tex, 1200 tex and 2400 tex in warp and weft. There is a special device to make the tension uniform. Because of the positive rigid rapier, roving is woven in weft without loosing a single filament during pick up and transfer. The open shed weaving allows uniform weft tension for glass roving.
Punit Lalbhai, Kulin Lalbhai appointed Arvind’s new Executive Directors
Arvind Ltd. has announced the appointment of Mr. Punit Lalbhai and Mr. Kulin Lalbhai as full-time Executive Directors responsible for handling a clearly mandated profit centre responsibility along with providing strategic and leadership perspective to the group’s future direction.
Mr. Punit Lalbhai is an MBA from INSEAD (France) specializing in Strategy and General Management, along with Post-Graduate degree in Masters of Environmental Science from Yale University, and a Bachelors degree in Science (Conservation Biology) from University of California. He has received several awards and honors during his career, including Research Grants, Presidential Fellowship Grant, J.M. Long-Endowed Scholarship and inclusion in Dean’s Lists for consistent Academic Excellence. He is currently serving as a Board Member for Sustainable Apparel Coalition, Council Member for Better Cotton Initiative (Geneva) and Member of CII for Family Business Network.
Mr. Punit Lalbhai has been appointed as Executive Director responsible for giving strategic direction to the Industrial Businesses within the Arvind Portfolio (Advanced Materials, Heavy Engineering and Waste Water Management) and will be the profit centre head for the Advanced Materials Division whose establishment and commercial launch has been spearheaded by him since year 2010.
He will actively focus on identifying new business segments to enter, new JVs and partnerships to further expand the global footprint and product portfolio of this emerging business. He will continue to play the lead role in Arvind – PD Composites – a fiberglass weaving JV with PD Interglass Germany, which he has actively established.
In addition, he will play a lead corporate role on behalf of Arvind in its drive towards sustainability and becoming a more socially and environmentally responsible corporate citizen.
Mr. Kulin Lalbhai is an MBA from Harvard Business School, along with a Bachelors degree in Science (Electrical Engineering) from Stanford University, USA. He has held several leadership positions during his academic role, including serving as Co-President of Family Business Club at Harvard, Associate Director for Stanford Asia Technology Initiative and also serving as Conference Co-Chair for the Harvard-India Conference. He is passionate about Retail Industry and B2C businesses and has researched extensively on Disruptive Business Models and Online space.
Mr. Kulin Lalbhai has been appointed as Executive Director of the company to play a key role in shaping the future of Consumer Businesses within the Arvind Portfolio (Apparel Brands, Value Retail and Arvind Store) and will be the profit-centre head for the ‘Arvind Store’ business whose establishment and commercial launch has been conceptualized and executed by him since 2011. He will continue to grow the business with an aggressive expansion plan to achieve revenues of $50 million in the near future. He is also developing the strategy and relationship with a global bespoke apparel brand to produce customized apparel for the Indian retail market.
In addition, Mr. Kulin Lalbhai will be actively involved in shaping the future strategic direction of the Real-Estate business by working closely with the CEO and leadership team of the respective business.