Orient Craft Ltd, one of India's largest garment and apparel exporters, plans to to raise between Rs 250-350 crore (Rs 2.5-3.5 billion) from the capital markets in the first half of 2007, to fund its proposed expansion drive.
The expansion, which is to begin in the third quarter of 2006-07, would hike the company's capacity from 150,000 garments per day to 250,000 garments per day by 2008.
"All our future expansion will come in special economic zones as that is the only way to ensure that exports remain tax free and competitive.
Our new facilities will be coming up in the new SEZ that we are building," said, Sudhir Dhingra, chairman and managing director, Orient Craft Ltd.
The company is investing Rs 500 crore (Rs 5 billion) in constructing the first phase of a textile special economic zone that is expected to come up in Gurgaon.
It received the government's approval for this three months back and the notification for the first phase came through last week.
"In the first phase we will invest Rs 500 crore and in the next two phases, we will invite co-developers. We are in talks with parties in India and abroad as the total cost of the SEZ will work out to Rs 2000 crore (Rs 20 billion)," said Dhingra.
He added that the funds would be raised through a combination of internal accruals and borrowings.While the size of the SEZ in the first phase will be 460 acres, the total spread in the final phase will be over 750 acres. Orient Craft plans to begin construction by January 2007 and expects the SEZ to be fully operational three years later and have the capacity to employ 30,000 workers.
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