Amit Spinning Industries Limited has informed the Exchange regarding Board meeting held on July 12, 2025 for Expansion, Modernisation of Composite Textile plant and partial sale of machinery.
Awaiting price reaction for this filing.
The Board of Directors approved a major expansion and modernization plan for the company's composite textile facility in Kolhapur, requiring an investment of Rs. 40 Crores to be completed within 12 months. The funding will come from bank borrowings, unsecured loans from promoter directors, and proceeds from selling old machinery. As part of the modernization, the company will sell 52 old looms for Rs. 6.26 Crores to five non-related buyers, expected to be completed by September 30, 2025. After the expansion, spinning capacity will rise to 31,200 spindles (from 30,240), processing capacity will double to 1,00,000 meters per day, and sizing capacity will increase to 9 tonnes per day. The company aims to transform from a pure spinning unit to a composite textile player covering 'fiber to fabric' for better margins. Existing capacity utilization stands at 83%.
This is a significant growth-oriented capex that could improve long-term margins but will increase the company's debt load. The shift towards composite textiles and modern technology is a positive strategic move, though investors should watch for execution risks and any pressure on short-term profitability from the expansion spending.