Suashish Diamonds Investing $35 Mln in Jewelry Plant
June 23, 08
A heavy investment in erecting a new jewelry factory is planned by Suashish Diamonds Ltd. The Mumbai-based firm announced Monday that it will spend Rs 1.5 billion ($35 million) through its wholly owned subsidiary Suashish Jewellery to set up a state-of-the-art manufacturing facility in Mumbai’s Santacruz Electronic Export Processing Zone (SEEPZ). The money will be invested in two phases, the first of which will consist of about $19 million (Rs 820 million), to be used in building and equipping the 16,000-sq-ft manufacturing facility, which is expected to begin operating in August. Suashish estimates that the new jewelry fabrication facility will increase its annual production capacity of 10 million pieces by another 500,000. “The first phase of the facility is expected to achieve a turnover of Rs 180 crores ($42 million) in a full year of operation,” said Ashish Goenka, managing director of Suashish. The second phase investment will be made in the next 2 years, Goenka added, saying that he predicted turnover to reach Rs 4 billion ($93 million) following the completion of the second phase. As to funding the project, Goenka said the company has a strong balance sheet with total assets of Rs 14.67 billion ($343 million) and reserves of Rs 5.88 billion ($137 million). “Our revenues for FY 07-08 (15 months) were Rs 12.23 billion ($286 million) and PAT was Rs 820 million ($19 million). Given this, we do not see raising resources for the capital investment as a problem,” Goenka said, adding that the company will look at a mix of internal accruals and equity capital to fund the new investments. The Suashish has Sights in India and Botswana. It has been ranked 332 amongst