PDS Limited expands manufacturing footprint in Sri Lanka
The Morning: PDS Limited announced a development in its global expansion efforts. Its subsidiary, Norlanka Manufacturing Limited, is acquiring a 26% stake in Nobleswear Private Limited, the Company announced.
Nobleswear is a Sri Lanka-based specialized manufacturer of children’s wear products, offering development to finished product solutions for world renowned top apparel brands.
“We are thrilled to announce the acquisition of a 26% stake in Nobleswear Private Limited,” said PDS Executive Vice Chairman Pallak Seth. “This strategic move aligns with our vision to expand our manufacturing footprint beyond Bangladesh.
This move is a milestone in PDS’s strategy to broaden its manufacturing footprint in key locations, emphasizing its commitment to innovation, collaboration, and excellence in the global fashion industry. The acquisition further solidifies PDS’s foothold in the children’s wear segment and expands its comprehensive fashion solutions portfolio.
Nobleswear has established itself as a trusted partner for top apparel brands, delivering high-quality children’s wear products with a focus on innovation, sustainability, and trendsetting designs. Nobles clocked a topline of INR138 crore, which has more than doubled over the last 3 years, with a bottom-line profit of 8% in financial year 2023.
Norlanka reserves the right to acquire an additional 24% stake at the same valuation over the next three years. This strategic option positions Norlanka to further consolidate its position and actively participate in the growth trajectory of the partnership, underscoring our commitment to long-term collaboration and value creation.
By combining Norlanka’s manufacturing capabilities and PDS’ global network with Nobleswear’s expertise in children’s wear, the partnership aims to deliver unparalleled value to customers and drive growth in the highly competitive fashion industry.”
“The foundation of this acquisition is deeply rooted in our core values, particularly our commitment to maintaining an asset-light business model. Consistent with our ongoing operations, our strategic intent is to optimize this newly acquired manufacturing asset to unlock myriad sourcing opportunities, echoing the successful models we have established in Bangladesh and Sri Lanka through our existing manufacturing facilities. PDS propels a ₹10,000 cr plus sourcing business on the back of ₹700 cr manufacturing operations. This approach aligns with our overarching strategy to enhance efficiency, and drive sustained growth”, said PDS Group CEO Sanjay Jain.
Norlanka CEO Chandana Ranatunga added: “This strategic move not only expands our portfolio, enhances our operational capabilities but expands our customer base. We are excited about the potential synergies between Norlanka and Nobleswear, leveraging our combined strengths to deliver unparalleled value to our clients. The acquisition aligns with our commitment to excellence in manufacturing and innovation.”
OSL take:
Sri Lanka’s manufacturing and export sectors have shown great resilience and strength during challenging economic conditions faced by the country. There has been a steady growth in Sri Lanka’s manufacturing industry through the years with businesses engaged in the industry recording growth and profits through the years. Identifying the strength and growth potential in the country’s manufacturing industry, the Sri Lankan government has introduced many incentive schemes as well as conduct many promotional campaigns with the aim of expanding the foreign markets for local products to encourage more businesses into the manufacturing industry. The many trade agreements as well as trade concessions enjoyed by the country have also helped boost Sri Lanka’s manufacturing industry. With Sri Lanka’s economy on a growth path with expanding activities and a growing business potential, foreign businesses/investors could confidently explore the growing opportunities in Sri Lanka’s manufacturing industry. They could also look at forming partnerships or joint ventures with local businesses engaged in the manufacturing industry with the aim of further expansion.
| Article Code : | VBS/AT/20240123/Z_5 |