Highlights of the call

• As the wool prices have increased significantly and as PV is a substitute for the same there can be good demand for PV yarn and fabrics.

• The company’s on-going expansions plans of Rs 707.40 crore are progressing on schedule. The total capacity of spindles will increase to 2,11,584 and the total number of weaving & knitting machines to 279.

• The scheme of Amalgamation of SPBL with the company has been approved by the Hon’ble High Court of Rajasthan.

• The company’s 21 MW thermal power plant will be commissioned by March- April 2007. Presently the power cost is around Rs 4.5 per unit, which will come down to Rs 2.5 per unit (+ 0.90 paise of interest and depreciation). The company will be spending around Rs 89 crore on the same. The company will save around Rs 36 lacs per day.

• The present order book position is around Rs 81 crore of which Rs 54 crore is for exports.

• After the merger and acquisition the diluted equity stands at Rs 39.4 crore.

• The average yarn prices are around Rs 132 per kg for the quarter, while Rs 67 per metre for fabrics. The average price for cotton yarn is around $2.6 per kg or Rs 115 per kg.

• The realizations in the export market are at par with domestic ones.

• The company expects a turnover of Rs 900 crore, of which 75% will be contributed by yarn (of which 67% will be PV yarn and 7% will be cotton yarn) while 25% will be contributed by fabrics. The company targets a ROCE of 9% in FY08 and of 12.48% in FY 09.