Introduction

Group:- Sutlej Textiles and Industries Limited (Sutlej), is a part of the K K Birla Group
of Companies. Dr. K.K. Birla is the chairman of the K K Birla Group of Companies,
which has interests in diverse fields like Fertilizers, Engineering, Textiles, Sugar, Tea,
Coffee, Food Products, Media, Information Technology, Biotechnology and Shipping.

Company: - Sutlej Textiles and Industries Limited (Sutlej) was incorporated on 22nd
June, 2005 and was created out of a corporate restructuring exercise in which the Textiles
Divisions of Sutlej Industries Limited (SIL) and Damanganga Processors Limited (DPL)
were demerged into Sutlej with effect from July 1, 2005. The restructuring is aimed at
making Sutlej into a focused and an integrated company in the Textiles Industry with its
range of products varying from yarn to fabrics to home furnishing and now garments.

HISTORICAL BACKGROUND

Sutlej has inherited the legacy of SIL, which was promoted by late Mr. G.D. Birla in
1934 under the name of Sutlej Cotton Mills Limited, which was subsequently changed to
Sutlej Industries Limited in 1995.

Originally, SIL was set up with a composite textile mill at Okara now in Pakistan. After
the partition in 1947, the factory at Okara was seized by the Government of Pakistan.

In the year 1963, SIL established Rajasthan Textile Mills (RTM) at Bhawanimandi,
District Jhalawar, Rajasthan, to produce cotton yarn. In 1970, it diversified into
Synthetic blended yarn.

In 1981 SIL leased a spinning unit called Chenab Textile Mills (CTM) from Texmaco
Ltd. situated at Kathua (Jammu & Kashmir), manufacturing cotton yarn and synthetic
yarn. Subsequently in 1997, SIL purchased all the assets of CTM.
 In 2001, SIL forward integrated its operations by establishing Damanganga Fabrics
(DGF) at Daheli in Gujarat to manufacture and process fabrics. Sutlej has recently
installed facilities to manufacture Home Furnishings and Garments units at DGF.

Sutlej is today an integrated player in the textiles industry with a value chain extending
from yarn at one end and extending to fabric, garments and home textiles at the other,
enabling it to address opportunities in every intervening segment.

Sutlej is the biggest producer and is one of the largest exporters of value added
Synthetic and blended dyed spun yarn in the country. Sutlej is also one of the prominent
manufacturers of Cotton and Cotton Blended Dyed and Melange yarn in the country.

Sutlej is also amongst few exclusive spinners in India for specialty yarns such as
Modal, Lyocell and Tencel in the country.

Sutlej is one stop shop for all types of spun yarns for its customers because of a broad
product range. Sutlej is a pioneer in developing a large number of blends and shades to
meet the ever changing requirement of its customers.

Weaving

Sutlej has emerged as a preferred supplier of fabrics on account of its colours, blends,
textures and finishes in more than 26 countries.

Sutlej manufactures woven fabrics which are mainly used for suiting and trousers.
Sutlej’s strength to offer a vast product range stems from its ability to blend various yarns
to ensure the right texture, style and above all, the right value-for-money products to its
clients. Sutlej has state-of-the-art technology with computer aided designing equipments,
enabling wider range of design executed with precision, ensuring wider choices and
lower wastage.
The Home Textiles Project
 The Home Textiles has started commercial production since July, 2006 to produce 1.8
million metres of home furnishing fabrics per annum.

The product range comprise of furnishing fabrics and made-ups of Jacquard and
Dobby weaves of various types of fibre like cotton, polyester, rayon blends, chenille,
flax, silk, jute, linen and other blends. The product range includes curtain fabrics,
upholstery fabrics, seats and seat covers; mattress covers, bed spreads and covers; quilts
and quilting materials; table linen and kitchen linen, etc. It offers further value added
fabrics in terms of hand painted fabrics and embroidered fabrics.

Garments

The Garments production unit will commence commercial production by October,

2006 with a capacity of 1.5 million Trousers per annum.

Sutlej started a pilot plant in the fourth quarter of 2005-2006 to test market its
products. The trousers produced and exported have been well received. Sutlej is
expanding its capacities to produce Suits and Blazers as well.

The Company has following manufacturing units:

Units 672 Rotors

Location Rajasthan Chenab Textile

Textile Mills Mills(CTM) Damanganga
(RTM) Kathua, Jammu Fabrics (DGF)
Bhawanimandi & Kashmir Daheli, Gujarat
Rajasthan Fabrics

Products Cotton Yarn Cotton Yarn

134096 60112 Spindles
Spindles

Capacities* Man Made Man Made Processed .

Fibres Yarn1.5 Fibres Yarn Fabrics Home Textiles
million trousers 4.8 million 18 million Furnishing
p.a metres p.a. (58 metres p.a. 1.8 million
looms) metres p.a.

* Capacities include current and to be installed by 31st March, 2007.

 -

The management of Sutlej is vested in its board of directors comprising of eminent

industrialists, professionals and persons having wide range of industrial experience.

Dr. K.K. Birla is the Chairman of Sutlej and is the Chairman of the K K Birla Group
of Companies. Dr Birla is also a former member of the Rajya Sabha.

Mr. Chandra Shekhar Nopany is the Vice Chairman of Sutlej. He also holds a Masters
Degree in Science of Industrial Administration from Carnegie Mellon University,
Pittsburgh, USA and is a Chartered Accountant. He is an eminent industrialist and is
actively involved in various sectors such as Sugar, Textiles and Shipping. He is the past
President of Indian Chamber of Commerce, Kolkata. Presently, he is also the President
of Indian Sugar Mills Association.

Mr. N.M. Gupta is the President of Sutlej, who has vast experience in the Textile
Industry and is assisted by Mr. S.K. Khandelia, Vice President of Sutlej, a Chartered
Accountant having long experience in the Textile Industry.

Mr. R.N. Laddha, Whole-time Director of Sutlej is a Chartered Accountant. Sutlej has a
qualified and an experienced team of executives and professionals who looks after day-
to-day affairs.

The Authorised Share Capital of the Sutlej is Rs.17.90 crores comprising of

1,39,00,000 Equity Shares of Rs.10 each and 40,00,000 Preference Shares of Rs.10 each.

The Paid up Capital of Sutlej is Rs.10.92 crores comprising of 1,09,21,908 Equity

Shares of Rs.10/- each, which have been allotted pursuant to the Schemes of
Arrangement to the shareholders of SIL & DPL and will be listed at Bombay Stock
Exchange and The National Stock Exchange of India Limited.
 A modern resurgent textile industry is in the making. Post-quota regime Indian Textile
Industry is poised for a quantum leap and leverages its competitive advantage.
Investment climate in textile industry has drastically improved. Entrepreneurs are
expanding capacities and adopting strategies addressed to growing consuming class.
Industry is striving hard to improve quality, productivity and efficiency and introducing
global benchmark with the support of modern technology and IT solutions.

Indian economy’s growth at around 8% and focus on development of infrastructure

augurs well for the growth of industry. Bilateral and multilateral trade agreements will
facilitate better trade. Pragmatic approach by the Government in supporting the textile
industry and close co-operation with the industry will generate employment and growth.

Sutlej is fully seized of all the developments in domestic and international arena and is
fully leveraged to take advantage of changing scenario and opportunities which are
galore. To capitalize on the unfolding opportunities and face the challenges unfolded by
expiry of quota regime, level of technology, scale of operations and integration would
matter. Fortunately, Sutlej is well poised to capitalize on the unfolding opportunities in
textiles and clothing both in the international markets as well as in the domestic space,
due to having manufacturing facilities with State-of-the-art plant and equipments sourced
from across the globe, strong R&D Cell in each unit, wide marketing network and a large
pool of technical and managerial talent.

Sutlej is soaring higher and higher energized by expansion, forward integration,

modernization, upgradation of technology, product development, value addition and such
other initiatives.

With new initiatives, we expect to maintain the momentum of growth in turnover and
profitability.
The Indian textile industry contributes about 14 per cent to industrial production, 4 per
cent to the country's gross domestic product (GDP) and 17 per cent to the country’s
export earnings, according to the Annual Report 2009-10 of the Ministry of Textiles.

The industry provides direct employment to over 35 million people and is the second
largest provider of employment after agriculture.

According to the Ministry of Textiles, the total cloth production increased by 10.2 per
cent during September 2010 as compared to September 2009. The highest growth was
observed in the powerloom sector (13.2 per cent), followed by hosiery sector (9.1 per
cent). The total cloth production during April-September 2010 has increased by 2.1 per
cent compared to the same period of the previous year.

As per the latest data released by the Directorate General of Commercial Intelligence and
Statistics (DGCI&S), Kolkata, the total textile exports during April-July 2010
(provisional) were valued at US$ 7.58 billion as against US$ 7.21 billion during the
corresponding period of the previous year, registering an increase of 5.20 per cent in
rupee terms. The share of textile exports in total exports was 11.04 per cent during April-
July 2010, according to the Ministry of Textiles.

As per the Index of Industrial Production (IIP) data released by the Central Statistical
Organisation (CSO), cotton textiles has registered a growth of 8.2 per cent during April-
September 2010-11, while wool, silk and man-made fibre textiles have registered a
growth of 2.2 per cent while textile products including wearing apparel have registered a
growth of 3 per cent.

As per a Ministry of Textiles press release dated November 2, 2010, India has the
potential to increase its textile and apparel share in the world trade from the current level
of 4.5 per cent to 8 per cent and reach US$ 80 billion by 2020.

Technical Textile Segment

According to the Ministry of Textiles, technical textiles are an important part of the
textile industry. The Working Group for the Eleventh Five Year Plan has estimated the
market size of technical textiles to increase from US$ 5.29 billion in 2006-07 to US$ 10.6
billion in 2011-12, without any regulatory framework and to US$ 15.16 billion with
regulatory framework. The Scheme for Growth and Development of Technical Textiles
aims to promote indigenous manufacture of technical textile to leverage global
opportunities and cater to the domestic demand.

Further, the government is set to launch US$ 44.21 million mission for promotion of
technical textiles, while the Finance Ministry has cleared setting up of four new research
centres for the industry, which include products like mosquito and fishing nets, shoe laces
and medical gloves.
As per a joint study of the Ministry of Textiles and an industry body, the global technical
industry is estimated at US$ 127 billion and its size in India is pegged at US$ 11 billion.

Government Initiative

According to the Ministry of Textiles, investment under the Technology Upgradation

Fund Schemes (TUFS) has been increasing steadily. During the year 2009-10, 1896
applications have been sanctioned at a project cost of US$ 5.23 billion. The cumulative
progress as on December 31, 2009, includes 27,477 applications sanctioned, which has
triggered investment of US$ 45.5 billion and amount sanctioned under TUFS is US$ 18.9
billion of which US$ 16.4 billion has been disbursed so far till the end of April, 2010.
The Ministry of Textile has sanctioned a total of US$ 133 million under TUFS during
September 2010.

Moreover, in May 2010, the Ministry of Textiles informed a parliamentary panel that it
proposes to allocate US$ 785.2 million for the modernisation of the textile industry.

Last Updated: November 2010

The Scheme for Integrated Textile Park (SITP) was approved in July 2005 to facilitate
setting up of textiles parks with world class infrastructure facilities. 40 textiles park
projects have been sanctioned under the SITP, out of which 25 textile parks are already in
operation. Ms Panabaaka Lakshmi, Minister of State for Textiles, stated on November 25,
2010 under the SITP, about US$ 763.7 million has been invested into the scheme and
generated employment for 15,000 textiles workers.

Further, 100 per cent FDI is allowed in the textile sector under the automatic route.

In the Union Budget 2010-11 presented in February 2010, the Finance Minister made the
following announcements to benefit the textile industry:
The central plan outlay for the industry has been enhanced to US$ 1.03 billion. Of this
US$ 521.4 million is for TUFS, US$ 76 million for SITP, US$ 80.2 million for
handlooms, US$ 69.3 million for handicrafts and US$ 98.4 million for sericulture.
Allocation for textiles and jute industry is US$ 713.4 million.
The total allocation for village and small enterprises sector which include handicrafts and
handlooms is US$ 210.3 million.
US$ 31.5 million has been provided for development of mega clusters in handlooms,
handicrafts and powerloom sectors.
Customs duty at 4 per cent for import of readymade garments for retail sales has been
withdrawn.
The micro small medium enterprises in textiles sector have been given full CENVAT
credit on capital goods in one installment in the year of receipt of such goods and the
facility of payment of excise duty in quarterly basis.
The Minister of Textiles launched the Knitwear Technology Mission being setup at
Tirupur, Tamil Nadu, as part of Plan Scheme of the Ministry. The Mission is aimed at
upgrading the technology and skill levels in the knitwear segment of the textile industry,
to bring in more export competitiveness.

Investments

The textiles industry has attracted foreign direct investment (FDI) worth US$ 861.47
million between April 2000 and September 2010, according to data released by the
Department of Industrial Policy and Promotion.
NSL Textiles has set up a textile processing facility at Chandolu near Guntur, Andhra
Pradesh with an investment of US$ 64.23 million.
TT Ltd, an integrated textile and knitwear manufacturing and exporter, plans to invest
US$ 33.46 million to enhance its yarn making capacity and retail venture.
Textiles company Alok Industries will be investing US$ 193.46 million over the next two
years to increase capacity across its product portfolio. The amount would be spread
equally for the two-year period with an investment of US$ 96.73 million being made
each year.

The Road Ahead

The Synthetic and Rayon Textile Export Promotion Council (SRTEPC) has set a target to
more than double the export of man-made textile from the country. Presently, the global
man-made fibre (MMF) trade accounts for 60 per cent of the total trade in textiles.
SRTEPC plans to increase exports to US$ 6.2 billion by capturing four per cent market
share by 2011-12, stated G.K. Gupta, Chairman, SRTEPC.

With an increased focus on catering to the domestic market, the denim industry is India
expects the production capacity to rise by 100 million metres by 2011. According to the
Textile Association of India (TAI), the denim manufacturing capacity, which stands at
600-650 million metres per annum, is set to witness an addition by another 100 million
metres wherein 70 per cent focus will be on the domestic market.
COTTON YARN
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Carded Yarn : Count Range : Ne 20 s, 24 s, 30 s, 34 s, 40 s, 50 s, 60 s
Combed Yarn : Count Range : Ne 20 s, 24 s, 30 s, 34 s, 40 s, 50 s, 60 s

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Recyled Fibre Yarns

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Carded Yarn : Count Range : Ne 20 s, 25 s, 30 s, 36 s, 40 s, 60 s
Combed Yarn : Count Range : Ne 40 s, 60 s, 67 s, 70 s, 80 s, 100 s, 120 s
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MELANGE YARN
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