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BW Businessworld

Nitin Spinners: Spinning Growth

The Bhilwara-based company has completed 23 years and has grown into a Rs 900-crore firm that makes cotton yarn in single, multi-fold slub, compact, core spun and Elitwist yarns

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Son of an employee at textile fabric maker LNJ Bhilwara, Dinesh Nolkha grew up listening to stories about clothing and textile mills. A chartered accountant by education, Nolkha wanted to create something of his own. In 1993, 22-year-old Nolkha decided to become an entrepreneur in a family of service men. “I decided to pursue my ambition and named the company after my younger brother, Nitin,” says Nolkha, managing director of Nitin Spinners. Brother Nitin is now executive director of the company.

The Bhilwara-based company has completed 23 years and has grown into a Rs 900-crore firm that makes cotton yarn in single, multi-fold slub, compact, core spun and Elitwist yarns. Nolkha started this company with an initial investment of Rs 3 crore. “Our business saw a severe downturn in 2008 that lasted till 2012 due to derivative losses,” he recalls. “I took it as a learning experience and stopped speculating on raw-material. We have improvised our hedging strategy, which is one of the core reasons behind our fast growth,” says Nolkha.

From 2011 to 2016, Nitin Spinners’ revenue growth stood at 15.67 per cent, whereas its profit (after tax) growth stood at a whopping 247.45 per cent. This clearly reflects that the company has improved its profit margins as revenue growth is less than profit growth. “Better hedging strategy, cost optimisation and happy clients are what contributes to our profitability,” says Nolkha.

About 65 per cent of the company’s production is exported to over 50 countries including the US, EU, Africa, Middle East and far east. However, with growing quality consciousness among Indian consumers and their increasing spending power, the domestic market is an equally attractive business opportunity. “Till 2009, we were totally export oriented. But realising the changing demands of Indian consumer, we turned our heads towards the domestic market. It constitutes about 35 per cent to our revenues now.”

Started with just 70 employees, the company today employs over 3,200 people. The office premises, however, remain the same. “There is an attachment with this place. We have seen our business expanding,” says the humble, 46-year-old Nolkha.

But then, his business has always done well, he says. The compounded annual growth rate was always about 20 per cent. “We have respected the basics. The ideal to follow is to keep customers happy. No firm with satisfied customers can fail or go into losses,” asserts Nolkha.

Further, the company’s exposure to foreign markets is believed to have made it future ready. “With growing mall culture in India, we are better prepared to understand the demand, and we have leveraged our learning to impress local clients here.”

Born in 1970 in Bhilwara, Nolkha is a member of the Institute of Chartered Accountants of India (ICAI) and the Institute of Cost & Management Accountants of India (ICMA). He was ranked 4th on all-India basis in ICMA final exams in 1991 and 43rd in ICAI final exams in 1992.

Nolkha was always good in studies, and now he has proved his mettle in business too. Nitin Spinners has been awarded the Texprocil Silver trophy for second highest exports in the category of grey fabrics for 2006-07 and 2007-08 and the Bronze for 2010-11, 2014-15 and 2015-16. The government of Rajasthan has also awarded the company with the State award for excellence in exports for 2007-08, 2010-11 and 2013-14.