The Rusayl-based Muscat Thread Mills (MTM), as part of its major expansion plan, will launch its manufacturing facility in Bangladesh. The board of the company in its recent meeting approved the plan and commissioned a feasibility study to be prepared by an independent consultant in this regard. “Bangladesh is one of the fastest growing markets in the world with respect to the garment industry. The scope for growth in the country is very high”, says Nihal Kodagoda, General Manager, MTM.
According to him, the production facility will be that of similar size to the one in Muscat. Established at the Rusayl Industrial Estate in 1997, with a market capitalisation of RO 1.9 million, the export-oriented polyester thread manufacturer is also all set to tap the home market. “The machinery required for the purpose of producing smaller cones of thread for the domestic tailoring market has already been purchased and production will start soon”, Nihal told Observer.
The new product to be introduced to the local retail market will be under its Boat brand. MTM owns two brands, namely Boat and Silver Falcon. The Silver Falcon brand is spun polyester thread that is of slightly higher quality than Boat and is more expensive. It records higher sales than the Boat brand as it caters to a premium segment in the market.
At present the company manufactures only industrial sewing thread for large garments makers and exports to 16 countries including India, Pakistan, Jordan and Kenya.
“Although industrial segment is the prime area of focus we look beyond to add more nominations to our portfolio by enhancing our presence in the Gulf Cooperation Council countries”, Nihal says.
He feels that diversification of operations into markets in other countries will minimise the impact of economic downturn as more options are open before us”, he adds.
The company has top-line technology at par with international standards. While the automated machinery ensures high quality, licence from world acclaimed manufacturers makes its marketing lucrative.
The company is optimistic that the foray into the local market will generate additional revenue, which in turn will enable the shareholders to get more yields to their kitty.
Nihal says: “Before entering the home market, we wanted to first stabilise our profits, consolidate operations and establish a good reputation in the region. Now that both have been achieved, Oman market looks lucrative for us”.
When compared with rival imports in Oman, we have a good competitive edge of being a local manufacturer enabling quick delivery of products along with proper insights about what the market conditions and demands,” he adds.
In the financial year 2011, MMT achieved a robust growth of 32 per cent in net profit and gave away a dividend of 30 per cent in cash and stocks to the shareholders.
Analysts are confident that the company will be able to sustain the profitability in view of the expansion plans and also rise in production.
MTM’s net profit for the first quarter of 2012 doubled to RO101,000 compared to the same period last year. Excluding exceptional items, net profit for the quarter remained unchanged from the same period year ago while total turnover for the quarter increased marginally by three per cent to RO941,000.