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Arvind Mills changes name, focus, strategy

Posted: 13 May 2008 07:10 AM CDT

Textile major Arvind Mills which has been recently going through a bad patch owing to rising rupee, reducing exports and falling margins is undertaking a business transformation in a bid to become a billion dollar company.

The company has firstly changed its name from ‘Arvind Mills Ltd’ to ‘Arvind Ltd’ with a new logo and identity to reflect a company which is diversified with focus on branded apparel and retail.

The promoters will increase their stake from 34% to 47% and infuse Rs.188 crore capital into the company.

Also, half of the Rs.1400 crore debt which Arvind Ltd has would be repaid by selling off land at Ahmedabad and Bangalore thus positively affecting the company’s profitability.

Arvind is now giving more focus to brands and retail which uptil now contributes 19% of total revenue. It will also move to become an integrated textile player by producing fabric as well as retailing it.

With a combination of its own as well as licensed brands, Arvind aims to become the largest apparel brand in India with focus on Tier II and III cities.

Major empahasis would be on the value store format ‘Megamart’ which is targeted to achieve Rs.1000 crore sales in 3 years. Other than that Arvind plans to setup 250 small format and 30 large format stores by 2012.

The strategy may work out to be rewarding for the company as it has a good portfolio of domestic and international, and has been a established national player. The move also helps it to ward off any risk it faces from the recession in export markets.

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