Safari Industries (India) Limited approves Rs 60 crore capacity plan

Safari Industries (India) Limited approved up to Rs 60 crore for its wholly owned subsidiary, Safari Manufacturing Limited, to add 6 lakh pieces of monthly capacity by June 2028, taking its capacity to 16 lakh pieces from 10 lakh. Safari Manufacturing was operating at 100% capacity when the board approved the plan on 5 November 2026.

What capacity expansion did Safari approve?

Safari approved up to Rs 60 crore of capital expenditure for Safari Manufacturing to add 6 lakh pieces of production capacity a month. The board approved the investment on 5 November 2026 alongside a separate approval of up to Rs 170 crore of capital expenditure for Safari.

Safari Manufacturing’s existing capacity is 10 lakh pieces a month, while the planned addition is 6 lakh pieces a month. On completion, capacity is expected to reach 16 lakh pieces a month, representing a 60% increase over the existing base.

The announced investment covers infrastructure improvement, land acquisition for a new warehouse, and installation of plant and machinery. Safari did not provide a split of the up to Rs 60 crore allocation between land, warehouse infrastructure and machinery.

Why is Safari adding manufacturing capacity?

Safari is adding capacity because Safari Manufacturing’s existing 10 lakh-piece monthly capacity was at 100% utilisation, and the company said the project is intended to cater to increased demand and future growth. The disclosed utilisation means the subsidiary was using its stated current capacity in full at the time of the 5 November 2026 announcement.

The filing does not disclose an order book, a demand forecast, product-level volumes or projected revenue from the additional 6 lakh pieces a month. It therefore sets out the physical capacity target and rationale, but not an expected sales or profit contribution from the expansion.

Safari reports its business as a single operating segment, luggage, under Indian Accounting Standard 108, Operating Segments. The financial results for the six months ended 30 September 2026 consequently do not split the proposed capacity addition among luggage categories, brands, domestic sales or exports.

When will Safari Manufacturing complete the capacity addition?

Safari Manufacturing expects to complete the 6 lakh-piece monthly capacity addition by June 2028. This date is the stated expected timeline for completion rather than a disclosed phased commissioning plan.

Safari did not provide milestones between the 5 November 2026 approval and June 2028. The announcement does not state when spending will begin, whether land for the new warehouse has already been acquired, where the warehouse will be located, or whether capacity will be commissioned in stages.

The company disclosed an end capacity of 16 lakh pieces per month, but did not state annual production assumptions or the operating schedule underlying that number. It also did not specify whether its existing 10 lakh-piece figure is nameplate capacity or capacity calculated under a particular production calendar.

How will Safari fund the Rs 60 crore project?

Safari Manufacturing will finance the up to Rs 60 crore project through internal accruals. The announcement does not disclose a project-specific borrowing facility, equity issuance, interest cost or repayment plan.

The board separately approved up to Rs 170 crore of capital expenditure for Safari and up to Rs 60 crore for Safari Manufacturing on 5 November 2026. The filing says the approvals relate to infrastructure improvement, warehouse land acquisition and plant and machinery, but does not allocate the company-level approval by project or provide a timeline for that wider expenditure.

Safari reported consolidated cash and cash equivalents of Rs 2.52 crore as at 30 September 2026, down from Rs 8.49 crore at 31 March 2026. Consolidated bank balances other than cash and cash equivalents were Rs 262.46 crore at 30 September 2026, compared with Rs 261.51 crore at 31 March 2026, though the filing does not identify the amount available for the expansion.

What do Safari’s latest results show before the expansion?

Safari reported consolidated revenue from operations of Rs 1,170.80 crore for the six months ended 30 September 2026, compared with Rs 1,061.38 crore in the six months ended 30 September 2025. Consolidated profit for the period declined to Rs 84.68 crore from Rs 97.43 crore over the same comparison.

For the quarter ended 30 September 2026, Safari’s consolidated revenue from operations was Rs 582.22 crore, up from Rs 533.55 crore in the quarter ended 30 September 2025. Consolidated quarterly profit was Rs 36.93 crore, compared with Rs 46.94 crore a year earlier; these reported results do not establish the eventual financial effect of the June 2028 capacity addition.

The board also declared an interim dividend of Rs 2 per equity share of face value Rs 2 for financial year 2026-27. Safari set 12 November 2026 as the record date and said the dividend would be paid on or before 5 December 2026, separately from the manufacturing investment approval.

Conclusion

Safari’s approval directs up to Rs 60 crore of internal accruals towards a 60% increase in Safari Manufacturing’s monthly capacity, from 10 lakh to 16 lakh pieces. The decision follows the subsidiary’s disclosed 100% capacity utilisation and combines warehouse-related infrastructure, land acquisition and plant-and-machinery spending to address increased demand and future growth.

The disclosed next project milestone is expected completion by June 2028. The matters to watch are whether Safari announces land acquisition, capital-spending timing, phased commissioning or further details on the separate up to Rs 170 crore company-level capital-expenditure approval.