Loyal Textile Mills Ltd - Stock Valuation and Financial Performance

Loyal Group is a multi-faceted organization, providing an array of products and services for textile and apparel industries. In more than its seven decades of establishment, the Group has created several benchmarks and established milestones for the forthcoming generations.

The Loyal Group was founded by Late Kalai Thanthai Karumuttu Thiagaraja Chettiar (1891 - 1974). He founded the group in the year 1956. He started business from a small Spinning and Weaving mill using second hand machines and handloom. The company was primarily started to provide work to laid off workers of a larger mill and with the passage of time it became the largest spinning mill in India.

Loyal Textile Mills Ltd has three spinning mills located at Kovilpati, Sattur and Arasanur, having around 1,35,000 ring spindles and 3840 rotors, which belong to global brands like Rieter, Truetschler, Marzoli, Electrojet, Lakshmi, Toyota, Schlafhorst, Savio and Murata. Besides this, the spinning divisions of Loyal Group use advanced testing instruments of USTER and PREMIER make.

Loyal Group comprises of two composite mills, one spinning mill, one dye house, three garment manufacturing units, one trading cum retailing company and two international trading companies (a Joint Venture with an Italian firm and a 100% owned trading company in United Kingdom). Besides, the Group has in its fold the 158-year-old watch trading company 'P'orr & Sons', which has 8 operational stores in Tamil Nadu and Andhra Pradesh (India).

An ISO 9002:2000 accredited, The Loyal Group follows a strict ethical code of conducts in its business operations. The Group's annual turnover is Rs.4,500 million (US$ 110 Million), out of which, Rs.3,000 million (US$ 75 Million) revenue was generated from exports. Loyal Group exports products to various countries which includes Israel, Egypt, Turkey, U S A, EU Countries, United kingdom, Japan, Thailand, South Korea, Dubai, Sri Lanka, Bangladesh, Brazil, Argentina, Columbia.

In recognition of its continual improvement in export performance, the Government of India has awarded Group with 'Three Star Export House'. Over the years, the group has been credited with several accolades and awards in recognition of its consistent export performance.

100% of the cotton is tested using HVI instruments and issued for mixing using a Bale management system, which ensures a narrow band of average yellowness and micronaire values.

Product range of the company includes:

Yarn

• Compact yarn: In the compact spinning system yarn quality is increased by means of narrowing and decreasing the width of the band of fibers, which come out from the drawing apparatus before it is twisted into yarn and by the elimination of the twisting triangle. The process reduces the fur ratio by 60s % while improving the strength and elongation by 15 to 20%. It also provides an unique texture to the yarn and the imperfections are reduced by 10 to 15%.
• Melange yarn: Melange yarn are produced by blending dyed polyester or viscous with white polyester /cotton. The multiple types fibers of differentiated colors are arranged randomly and piled one upon another into a stack of layers to get different shades. The yarn can be availed in variety of colors and combination of materials.
• Dyed polyester blended yarn:The dyed polyester is blended with cotton yarn to get different shades. Using this process, fibre with a high tensile strength is produced while considerably reducing the production cost.
• Kermal blended yarns: Kermal is an armide fibre blended with polyester and cotton to produce fire retardant yarns. These yarns are widely used to manufacture protective clothing for protection against exposure to flash fire in high risk working zones.
• Carbon yarn:The weaving method includes a warp supply process for supplying twist-free flat warp having opposed flat surfaces and containing carbon fiber to a weaving loom. Carbon is blended with cotton or PC blend to produce yarns that are helpful to avoid electric shocks. This yarn is used to produce protective clothing, where electric conductivity risk is high.
• Fancy yarns:The weaving method includes a warp supply process for supplying twist-free flat warp having opposed flat surfaces and containing carbon fiber to a weaving loom.

Fabrics

• Grey WovenThe variety of fabric weave includes, Sheeting, Canvas, Satin, Drill, Twill, Gabardine, Herringbone and Oxford Weave. Equipped with the most modern looms, Loyal Group produces fabrics in widths ranging form 40'to 132'.
• Dyed WovenThe process-house specialties include high- visibility fluorescent finish, flame retardant finish, stain-guard, wax-coating and anti-static finish, besides dyeing and bleaching of cotton and poly-cotton fabrics.
• Grey KnittedThe entire range of single jersey (also with lycra/spandex), interlock,rib, 2 and 3 thread fleeze, pique polo and flat bed colour are produced.
• Dyed KnittedVery good quality of bleached and dyed knitted fabrics are produced out of SCLAVOS and SANTEX machines.

Achievements/ recognition:

• Bronze trophy for the year 1997-98 for being third largest exporter of cotton fabrics in the country
• Silver trophy for the year 1998-99 for being second largest exporter of cotton fabrics in the country
• Silver trophy by AEPC for being fourth largest exporter of garments under non-quota category from the year 1999
• Bronze trophy for outstanding export performance in yarn amongst mill exporters from TEXPROCIL for the year 2001-02
• Bronze trophy for the year 2004-05 for being third largest exporter of cotton fabrics in the country
• Gold trophy for the year 2006-07 for being the largest exporter of cotton fabrics in the country
• Certified 3 star export house
• ISO 9000:2000 certified
• ISO 14001:EMS certified
• SCAL organic production MT certified
• SA8000 Certification underway
• Corporate office under green building certification
• OEKO Tech standards for dyed fabrics
• Bardush standards for European industrial wash
• BS 2576/1986 & ASTM D1424/1996 standards for fabric
• ASTM D5034/ASTM D1424 standards for dyed fabrics
• ISO 13934/ISO 4074-2 dyed fabrics for purpose