Highlights of the call are:

• India is second largest country with spinning capacity of 44 million spindles after China which as 125 million spindles. Tamil Nadu accounts around 41% of the spindlage in India followed by Maharashtra and Andhra Pradesh 10% each respectively. Currently, 80% of the spindlage capacity in India is owned by small mills.

• The cotton prices are now currently ruling at around realistic prices of Rs 36000 a candy against Rs 60000 a candy a year ago. However, mills are not able to recoup the losses they have incurred in short period of time due to revaluation of inventory. The scenario of Capacity build up in Textile Industry is bleak currently as the spinners have lost their case of profitability due to sharp volatile cotton prices in H1FY12.

• While the north Indian spinning mills are currently improving and are utilizing capacities. The South Indian players are struck with problems of power shortage.

• According to management extension of TUFS to the textile industry would be a major trigger for the company.

• Project orders have drived the revenues of the company in FY12. For the 9MFY12, the company has reported 27% increase in revenues at Rs 1583.45 crore. During the 9MFY12, the company has order inflow of Rs 900 crore, while Order inflow during H2FY12 is negligible. The Outstanding order book of the company at the end of March 12 would be around Rs 4000 crore against Rs 4700 crore at end of FY11. Of this Rs 4000 crore of order book, only 30% is active book translating to Rs 1200 crore of orders.

• With no clear picture on the revival of spinning industry on capacity expansions, the management expects FY13 to be in line with FY12.

• Despite increase in input cost for raw materials like Iron and Steel castings, the company has no plans to increase the pricing of their product mix to keep up their market share; despite pressure on margins. The company generally maintains gap of 10-15% with the competition on the pricing front.

• Export orders constitute 10-12% of sales of the company. The management has no plans to increase the export sales as Domestic market is the key to them. Generally, export orders have lower time gap to commence orders than the domestic orders. Bangladesh is a major market for the company's exports. The company is also keen to enter Pakistan market. (Pakistan currently imports 70% of its spindlage requirements from China and 30% from Europe).

• The Chinese subsidiary of the company has sold nearly 0.5 million spindles in FY12 and has reported Rs 100 crore of revenues in 9MFY12. The company manufactures long ring frame in this subsidiary. Currently only 10% of the china spindlage works on long ring frame and the management expects that the use of long ring frame may increase to 50-60% in next 15 years. The management plans to source only 30-35% of the technology parts from India to China, while the rest are sourced locally following price pressures. Currently, localization of parts at Chinese facility was of the order of 45%, which will be scaled up to 65-70% in coming years. It also plans to increase the product mix in this facility and become a total solution provider. The management expects the facility to report break even in profitability in current quarter.

• The company has added 8.85 MW of wind power in FY12, totaling wind mill capacity at 36.85 MW, which can satisfy 75% of the power requirement of the company.

• The company has land bank of 25 acres in two plots in Coimbatore. The company plans to develop these two properties in to residential space. It has already got approval from Government for building 236 flats (both 2BHK and 3BHK) in 5 acres of land. It is now looking for a builder for this property development. The management expects cash flows from this property in FY14.

• Cash on book was to the tune of Rs 680 crore of which Rs 400 crore pertains to the advances from customers.