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- 1. W elspun India Limited Presentation on Seizing The Emerging Global Textiles Opportunity CONFIDENTIAL DRAFT
2. Welspun Group Profile
- US$ 400 million, engaged in
- Terry Towels
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- Largest Terry Towel producer in Asia
- Polyester Filament Yarn
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- One of the largest SpecialtyPolyester Filament Yarn producer In India
- Polyester Buttons and Resins
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- Largest producer of Polyester Buttons in Asia
- Cotton Yarn
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- One of the prominent players in India
- Saw Pipes
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- One of the largest capacities of Saw Pipes in Asia, outside Japan.
PAGE 3. WELSPUN INDIA LTD- Overview
- Asias largest and worlds 4 thlargest Terry towel producer
- Current Terry towel capacity :10,800 Tons being expanded to 23000 tons
- Becoming a complete home textile player by addition of bed linen
- Plant at Vapi Gujarat and Anjar, coastal Gujarat, India
- Distribution network in 32 countries
- Exports revenue- 94% of total revenue ( 68% to the US market)
- Certification:
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- ISO 9002/14001 and SA 8000:2001 by M/S BVQI
- Only Indian company to license life-style brand in Home Textiles
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- Nautica for towels in US and Canada
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- Tommy Hilfiger for Home Textiles in India
PAGE 4. PAGEWelspun Journey to become a Global Home textile Player 5. CIRCA 1994
- Polyester yarn manufacturer
- Turnover wasRs 90 Crs, Net Profit of Rs 4 Crs
- Started Towel Business
- Challenges:
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- To produceTowel New Business Line
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- To produceQuality Towel
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- ToExport Quality Towel EOU status
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- ToExport Quality Towel to Knowledgeable Matured Market
PAGE 6. CIRCA 1994 Cont..
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- Emphasis on Maximum Production
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- Quality improvement at each stage of production
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- Product Analysis based on Customer feed-back
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- Emphasis on Volume Growth
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- Focus on Sales from the maximum Outlets
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- Started Business through Intermediaries Exporters, Buying Houses.
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PAGE 7. CIRCA 1999
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- Produced Quality Towels
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- Exported Quality Towels
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- Expanded Capacities from 2500 Tons to 7800 Tons
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- Grew in Volume and Value Terms
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- Emerged as largest Exporter of Towels from India
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- Turnover Rs 325 Crs significant for Towel Co
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- Profit after Tax of Rs(31.5 Crs)
PAGE 8. CIRCA 1999- Cont..
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- External Dependence- All Business through Intermediaries
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- Presence in Generic Products Yarn and Plain Dyed Towels
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- Focus on Sales rather than Marketing
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- Limited Designing Efforts
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- Limited Processing capabilities right color/right shade/right mix was a challenge
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- Financial Crunch
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- In nut shell Innovation was a missing Link
PAGE 9. CIRCA 2000- Putting heads together for aNew Beginning PAGE 10. Strategy
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- Adopted Vision to become a Truly Global Player and communicate to all our employees
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- Breaking the midriff - middle-men/agents from the business cycle Jettisoning Extra Baggage
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- Direct Relationships even at the cost of dip in sales
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- Decided to invest in Product Developments and Design Capabilities
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- In Essence Adopted Innovation in entire Business Operation -Product, Processes, Practices and People
PAGE 11. Innovation In Products
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- Paradigm shift fromUSE to COLLECTIONrange of products
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- New Value added product lines Egyptian Cotton, Embroidery,Supima (American Cotton), Kid Centric Towels.
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- Experimented with different inputs like PVA fibers
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- New Product development
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- Hygro Cotton
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- Zero-twist
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- Subslistatic Printed
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- Blister Pile Towels
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- Developed new shades and floral prints that are trendy and inline withthe Fashion Industry
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PAGE 12. PAGE
- Process House: Fully Atomized color mixing
- Design Innovation
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- Developed new Designs by creating one of the best Home textile designing team
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- Design Studios
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- Design house in India - 5 people
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- 2 designers each in US and UK
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- Appointed World class Designer from the Industry
Innovation In Processes 13.
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- Innovation in Sales and Marketing Processes
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- Selection of Right Business Partners
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- Created Marketing Infrastructure
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- Sales team in US
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- 6000 sq. ft. exclusive showroom in New York
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- Distribution alliance in the US for distribution and warehousing
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- Created Welspun USA - 100% subsidiary to handle customers directly
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Product Development skills complimented by Global Sales Network Innovation In ProcessesPAGE 14.
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- Utilizing IT as Integrator
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- EDI & RFID in Welspun USA
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- Integration with Customers
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- Electronic Coloring and Design Matching which integratesProduct Design & Development
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- SAP R/3- Integrates Operations, Marketing and Supply Chain
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- Reverse Auction
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Innovation In Practices PAGE 15. Innovation In Practices
- Market Intelligence : Conducted Grid analysis of top retailers with respect to:
- Product range,
- Fast Moving Items best selling SKUs
- Profit margin expectation
- Collection of Samples to understand
- global developments
PAGE 16. People
- Paradigm shift in Mindset from Manufacturer to Marketer.
- Adequate Training in SAP enabled Production and Operations
- Appointed International Textile consultant to improve skill sets of employees
- Appointed Experienced and result oriented people from the Industry .
- Performance based Reward system
PAGE 17. YEAR 2004 - RevisitedPAGE 18. Product wise sales in terms of % (based on ex-mill values) The proportion of the value added products has increased PAGE 19. Time Value Creation 95 2000 2003 2004 2005 Indirect Export Direct Export Choose & Pick amongst Retailers High end products Branding Marketing & Outsourcing PAGEProgress in Value Chain 20.
- Long standing relationship with 12 out of 20 top retailers in the world
- Customer centric Planning and Production mechanism
BETTERNWELT MITSUKOSH Customer Relationship PAGE 21. Value Chain contribution May&Co, Federated,Dillards BB&B ,LNT ,Kohls J C Penny ,Target ,Shopko Wal-Mart ,K Mart, Costco Tommy Hilfiger ,Nautica, Polo Ralph Lauren, DKNY, Calvin KleinDesigner Brands Department Stores Specialty Stores Fashion Stores Mass Merchants x + 5-7% + 13-15% 2x Retail PriceExpansion PAGE2003 2004 2005 8% 2% 0% 32% 33% 15% 22% 12% 15% 1% 5% 10% 3% 4% 10% 8% 12% 15% Indirect Business 22. Comparison PAGE32.19% Venture Capital & Mutual Funds 2.66% 24% FII Holdings - 800 Market Cap. 41 295 Net Profit (35) 374 Turnover 325 FY 2005 (Rs. Crs) Particulars FY 1999 (Rs. Crs) 23. Global Opportunities PAGE 24. Todays Global market place
- Quota phase out An additional market of $ 1.25 bn in Towel and $ 1.75 bn in bed linen Segment alone
- Shrinking supplier base released
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- Pillowtex - bankruptcy - $ 450 mn of towel and $ 220mnof bed linen supply.
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- WPS - Chapter 11 $ 455 mn of towels and $ 580 mn of bed linen supply.
- Lucrative European market of $ 600 mn with shrinkage of supplier base.
- Australian and New Zealand market of $ 50 mn
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- Dropping duties 25 to 17.5%, rendering there capacities idle
- Increased domestic demand
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- Few organized player in the home arena to cater to the market
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- Low interest rates and higher disposable income
PAGE 25. Key Differentiators PAGE 26.
- Success Algorithm
- Textiles has been forecasted as another BPO success story, what Y2K did for IT , Y2K5 could do for Textile Industry
- Mantra For Success as followed by Infoys -
- P: Profitability
- S: Scalability
- P: Predictability
- D: Dependability
PAGE 27. Vision 2005 and Beyond PAGE 28. Innovation in 2005 and beyond
- Products:Continuous Innovations in Products-Bamboo Filaments, Hollow Yarn, Natural Towels
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- New Business Lines like Bed Linen
- Processes: Automatic Recipe matching Orgatex, Automated Operations like Cut and Sew.
- Practices: Patenting of New products to Create differentiators.
- People: Knowledge Management, Six Sigma and ESOPs
PAGE 29. Vision This is what we are aiming at.
- Fully integrated textile company4 Fs - from farming to factory to fashion to foreign retailing
- Organic and inorganic initiatives to target Growth
- Preferred partner in Home Textiles for any global initiative.
- Leader in embracing new technologies, product innovation, market intelligence - to offer competitive end-to-end solutions to our customers.
- Among top three home textile companies in the world.
- Market leader in Indian home textile market.
PAGE 30.
- RECOGNITIONS
National Export Awardfor outstanding performance fromGovernment of India,for the year 1996-97 Texprocil* gold trophyfor outstanding export performance for successive three years(1999-00, 2000-01 & 2001-02) Best Global Vendorby Wal-Martin2002 for Terry towel Vendor of the year,FY 2002 byShopko Stores Inc., USA for all its product categories Operational Excellence Awardby JCPenney Stores, USA for Year 2003 PAGE 31. W E APPRECIATE YOUR VALUABLE TIME PAGE