Textiles company
1) Arvind Mills
2) Raymonds
3)Reliance Textiles
4)Bombay Dyeing Ltd
5) Grasim Industries
Founded 1931
Headquarters Ahmedabad
Sanjay Lalbhai
Key people (CEO &MD)
Arvind N. Lalbhai
Revenue Rs. 23.45 Billion
Loss Rs.
Net income
480 Million
Employees 26000
Website www.arvindmills.
com
Arvind Mills was established in 1931. It was founded by the three brothers Kasturbhai Lalbhai,
Narottambhai Lalbhai and Chimanbhai Lalbhai one of the leading families of Ahmedabad.
1931 – Arvind Mills Ltd. is incorporated with share capital Rs.2525000 ($55000) in Ahmedabad.
Products manufactured are dhoties, sarees, mulls, dorias, crepes, shirtings, coatings, printed
lawns & voiles cambrics, twills gaberdine etc.
1991 – Arvind reached 100 million meters of denim per year, becoming the fourth largest
producer of denim in the world.
1992 – The Company increased the production of denim cloth by 23,000 tonnes per day by
modernising the plant located at Khatraj of Ankur Textiles.
1993 – The Company proposed to expand the denim manufacturing capacity by 85,00,00 metres
per annum. The Company also proposed to set up a new composite mill for producing annually
120 lakh metres of high quality shirting fabrics to be marketed in the domestic as well as
international markets.
1994 – The Company’s operations were divided into 3 units viz., Textile Division, telecom
division and garments division.
1995 – The performance of textile division was significantly affected due to an unprecedented
rise in cost of cotton. Garment division launched ready to stitch jeans pack under the brand `Ruf
& Tuf`.y
1997 – The marketing and distribution network of `Newport` brand was strengthened and the
relaunched `Flying Machine' and 'Ruggers` brand were strengthened.
The Company reported a fire in the goods godown & folding packing department in Naroda
Road unit of the company.
Arvind Mills sets up the anti-piracy cell for the first time in India to curb large scale
counterfeiting of their highly successful brands Ruf & Tuf and Newport jeans.
Arvind Mills adopts the franchisee system for the manufacture and distribution of Ruf and
Tuf jeans.
Arvind Fashions, doubles its capacity in the state-of-the-art manufacturing facility in
Bangalore to produce Lee jeans.
1997 was also the year when arvind mills started facing serious troubles financially
1998 – Arvind Mills emerges as the world's third largest manufacturer of denim.
Arvind Mills goes live with SAP R/3 ERP package in April 1998 in their new manufacturing
units.
1999 – Arvind Mills sets a two-month deadline for hiving off its garments division into a separate
company and sale of its real estate in Delhi.
2000 – CRISIL downgrades the debenture issues of Arvind, indicating that the instruments were
in default.
2001 – Arvind Mills defaults on a $125 million floating rate note issue and puts forward a debt
restructuring proposal that could significantly reduce its debt burden and sharply improve its
financial health.
Arvind Mills posts a net loss of Rs 44.59 crore for the quarter ended September 30, 2001.
2003 – For the fourth quarter, Arvind Mills witnesses 280% growth in the net profit
Arvind Mills Ltd is assigned a `P1+` rating by CRISIL, which indicates a very
strong rating for their commercial paper.
2004 – Company turns itself around showing remarkable improvement in financial
performance.
2005 – For the fourth quarter in a row, Arvind Mills has managed to post a profit
growth in excess of 80 per cent.
Arvind Mills decides to buy entire stake in Arvind Brands from ICICI Ventures.
Arvind Mills does not distribute dividends to its share holders consistently.
Financial restructuring
In the mid 1990s, Arvind Mills undertook a massive expansion of its denim capacity
even though other cotton fabrics were slowly replacing the demand for denim. The
expansion plan was funded by loans from both Indian and overseas
financial institutions. With the demand for denim slowing, Arvind Mills found it
difficult to repay the loans, and thus the interest burden on the loans shot up. In the
late 1990s, Arvind Mills ran into financial problems because of its debt burden, and it
incurred huge losses in the late 1990s.
The company came up with a massive debt-restructuring plan for the long-term debts
being taken up in February 2001. This complex financial restructuring exercise,
which involved several domestic and international lenders, is considered to be the
benchmark and a case study in India. The restructuring was overseen by Mr Jayesh
Shah, CFO and advised on by a JP Morgan Hong Kong team, led by Mr Ahmad Ayaz.
