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Envoy Textiles to set up own yarn manufacturing unit

envoy-complexEnvoy Textiles Limited (ETL) is going to set up a yarn manufacturing factory with a production capacity of about 50 tonnes per day by the first quarter of 2016.

It expected that the company’s annual profit would then be increased approximately to Tk40-45 crore and the annual turnover would stand at US$50 million.

The listed company’s third quarter (April’14 to June’14) net profit stood at Tk11.4 crore, slightly down from Tk11.9 crore in the same period a year earlier.

Yesterday, its share prices at the Dhaka Stock Exchange dropped by more than 2% to Tk50.6 a share.

Established in 2005, the company is a concern of the country’s business conglomerate Envoy Group.

“The yarn project will save huge cost,” Abdus Salam Murshedy, Managing Director of the group, told the Dhaka Tribune Yesterday.

Presently, the group procures yarn from local and international markets to feed the mills.

Around 80% of yarn to be produced by the new factory would be consumed by the mills of the group and rest 20% would be sold out in the market. And the earnings from selling 20% yarn will be used to buy other types of yarn to feed the mills.

The project titled ETL Spinning Unit will be established within its compound of denim factory plant at Jamirdia, Bhaluka, Mymensingh, with a total estimated cost of $30m. The compound covers an area of 48 acres of land.

HSBC and BRAC Bank will finance $20m under offshore financing arrangement for a maximum period of five years subject to final approval from relevant authorities and the ETL will provide rest of $10m from its own source as and when required.

The major capital machineries to be imported for setting up the manufacturing plant are mainly from Germany, Switzerland and Japan.

ETL introduced rope dyeing denim for the first time in the country. Currently, it produces quality denim fabric of 22m meters annually.

The company is also the largest denim fabric producing unit in Bangladesh with annual production of 24m meters.

Report:  Kayes Sohel

Source: Dhaka Tribune

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