The company's board has approved its Rs 120 crore expansion plan to make the foray into seamless garment manufacturing and also plans to set up 10,000 spindles for slub yarn production and mercerisation along with improvements and modernisation in its processing division. The company is said to be targeting the manufacture of 10,000 pieces of seamless garments per day from the start of its next financial year.

The Rs 120 crore expansion plan will be funded through a term loan of Rs 89.50 crore with the balance through internal accrual. The expansion is scheduled to be completed by 31 March 2015.

"This expansion plan will add to Rs 150-175 crore to our topline from the next financial year. We are looking forward to government's initiation new textile policy to boost job creations and exports and evaluating other opportunities for value added product to augment business growth of the company," company Managing Director S N Modani said.

The news comes as Sangam reported an 88.1% growth in net profit during the quarter to Rs 11.34 crore compared to the same period last year. The company's net profit stood at Rs 6.03 crore in the corresponding quarter in the previous year, the company said in a release issued yesterday. For the quarter ended 30 June, the company reported a 1.95% rise in net sales at Rs 372.93 crore compared to Rs 365.80 crore in the corresponding quarter of the previous year.

Commenting on the June earnings Sangam (India) Chairman R P Soni said: "Our performance reflects our belief in our strategy to focus on value-added products, leading to improved realisations.”

"This has enabled us post good numbers despite a visible slowdown in Indian as well as global economy. Going forward, the full impact of our expanded capacities will further boost our margins and thereby ensure sustained growth for the company."