Delhi-based cotton yarn player, Spentex Industries was on an acquisition spree.
It has made four acquisitions since the beginning of calendar year 2006 while expanding its existing capacities.
Spentex now has the largest capacity in India with approximately 5.7 lakh spindles, up from 55,440 in March 2006.
This year, the company acquired the assets of a non-operational Tai Chonbang Textile Industries based in Ahmedabad, Indo Rama Textiles (IRTL), Amit Spinning and assets of Uzbekistan-based textile company Tashkent Toyetpa Tekstil.
All the acquired companies have good potential in terms of profitability and will give them higher market share.
Spentex is open to acquisitions in India as well as in cotton-producing countries and is betting solely on cotton yarn.
Company has no plans to integrate forward at least for the next two years considering that demand for cotton yarn is expected to be robust.
Competitor Mahavir Spinning, however, is pursuing the organic path to growth. Currently, the Vardhaman group Company has a capacity of five lakh spindles, which will be scaled up to 8 lakh spindles by FY08.
Further, to enhance its margins, Mahavir is expanding its processed fabric capacity from 13 million meters to 90 million meters in the next two years.
Mahavir Spinning does not intend to look for overseas acquisitions, as there is enough scope within the country.
Spentex has not only gained size and scale but also added new range and markets to its current product portfolio apart from a wider geographical presence due to the acquisitions.
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