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Arvind Mills-Turnaround Strategy

Akshay Joshi
Alvin Thomas
Anish Pereira
Dilis Tharakan
Kevin George

History
Arvind Limited is a textile manufacturer and the
flagship company of the Arvind Group.
Its Headquarters is in Naroda, Ahmedabad,
Gujarat, India.
It manufactures cotton shirting, denim, knits.

Problems faced by the company

High wage structure


Low productivity
Surplus labor in the textile mills
Emergence of power looms
Governments indirect tax system
Shift in fashion
Debt burden kept on increasing.

Turnaround Strategies
Debt-restructuring plan for long term debts.
It proposed restructuring plan to improve its
financial health and reduce its debt burden.
They created new markets, and technology was
upgraded.
This resulted in the 280% growth in the net profit
The decisions were taken accordingly so that
every activity in the organization area was aligned
Currently Arvind Mills has a strong R&D which
focuses on process improvement, cost reduction
and new product development.

Financials
As on 31 st March 2002
Total loan funds - Rs.1638.71 crores, a decline by 27.58%
from the previous year outstanding of Rs.2326.82 crores
in FY2001.
Fixed Assets- Rs.6.63 crores in Machinery and disposed
Buildings for Rs.14.25 crores .
The Gross Block of Fixed Assets decreased by Rs.16.06
crores.
The Gross Capital Assets of the company were
Rs.1988.46 crores in FY2002 as against Rs.2004.52
crores as on 30 th September 2001.

Investments - As per the directions of the High Court,


Arvind Mills revalued and adjusted its Investments.
The Investments worth Rs.264.96 crores as on
30 th September 2001 were revalued to Rs.121.37 crores at
the end of FY2002.
Sales and Operating Income for the period ended
31 st March, 2002 was Rs.699 crores as compared to
Rs.1856 crores for the period of 18 months ending on
30 th September 2001 resulting in an annualized growth of
13%.
The revenue from Denim business grew by 19%
Revenue from shirting business has marginally improved
by 2% .
Knit business too witnessed growth in revenue of 34%

THANK YOU

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