Textile companies rush in with IPOs as TUFS expiry looms
27 Feb 2007
Mumbai: Textile companies are rushing ahead with capital raising plans before the expiry of government sponsored Technology Upgradation Fund (TUF) in March 2007.
Six textile companies mobilised over Rs400 crore by issuing IPOs in 2007. Under the TUF, the textiles firm receives the required finance at the subsidised interest rate of 5 per cent from the special fund created by the government.
Some
of the companies, which have already approached the capital
market in recent times, are House of Pearl Fashions, Hanung
Toys, Technocraft Industries, Mudra Lifestyle, Indus Fila,
Abhishek Mills, Evinix Accessories and Vijayeshwari Textiles.
The
removal of textile quota restrictions imposed by the European
Union (EU) and the US as per the WTO agreement has seen
an increase in the export sales of domestic textile firms.
With the availability of incentives for export promotions
in domestic market and huge opportunities for growth lying
ahead in the export market, many small- and mid-sized
textile companies are rushing to the primary market to
raise funds to finance their expansion facilities.