Vama Wovenfab plans 62 looms despite low capacity usage

Vama Wovenfab plans to buy 62 circular looms despite low capacity usage of 42% at its tape plant and 26% at each bag-machine category in FY 2025-26. The company says repairing its idle tape extrusion line and adding supporting equipment will increase fabric output, with circular-loom capacity projected at 93,81,600 kg.

Why is Vama Wovenfab adding 62 looms amid uneven capacity use?

Vama Wovenfab is pursuing a fabric-capacity expansion because management identifies tape extrusion, rather than loom count alone, as a constraint on output. Its manufacturing chain converts plastic granules into plastic tapes and yarn, which circular looms weave into tubular fabric. The fabric can be sold directly or further processed into woven bags, so the proposed equipment is directed first at the fabric stage.

The FY 2025-26 utilisation figures show why execution depends on restoring upstream yarn supply. Vama Wovenfab ran its 650 kg-per-hour tape line at full capacity, used its 250 kg-per-hour line only three times a week, and kept its 350 kg-per-hour line idle because it was not operational. Vama Wovenfab says it will repair the 350 kg-per-hour line through internal accruals; circular looms require yarn from tape plants, and the unavailable line contributed to 82% loom utilisation.

What does current capacity use show about Vama Wovenfab's plan?

Vama Wovenfab reported lower utilisation in tape extrusion and bag making than in weaving during FY 2025-26. The capacity measures are in kilograms and compare installed machines and shifts with actual production. The same 36,45,508 kg of output was reported for the tape plant and circular looms, consistent with tape production feeding the weaving process.

Vama Wovenfab is adding equipment at the weaving stage, where reported use was 82%, while capacity remained unused upstream and downstream. Vama Wovenfab says a repaired tape line, cheese winders and cheese pipes will improve tape handling and yarn availability for looms. The offer document does not state what share of added fabric capacity will be sold as fabric and what share will be converted into bags, leaving the route for using spare bag-machine capacity unspecified.

How large is Vama Wovenfab's proposed machinery increase?

Vama Wovenfab proposes machinery spending of Rs 7.2452 crore, comprising 62 Nova6-576 circular looms quoted at Rs 6.2124 crore, 240 tape winders quoted at Rs 82.80 lakh, and 9,00,000 steel cheese pipes quoted at Rs 20.48 lakh. The 62 proposed looms compare with 69 circular looms in the FY 2025-26 installed base, making the proposed addition close to the existing fleet size.

Vama Wovenfab projects post-expansion circular-loom capacity of 93,81,600 kg, compared with existing installed capacity of 44,71,200 kg. That implies an increase of 49,10,400 kg, or about 110%, based on the company’s certified capacity figures dated June 16, 2026. Output at that level requires the repaired 350 kg-per-hour tape line, the partly used 250 kg-per-hour line, winders and pipes to supply enough yarn, while customer demand must absorb additional fabric.

The machinery narrative refers to 90,000 cheese pipers, but the vendor quotation table lists 9,00,000 steel pipes. Vama Wovenfab has not disclosed an explanation for that difference. The quoted machinery amounts exclude goods and services tax, and the company says no second-hand machinery is being acquired.

What are the funding and implementation conditions for the plan?

Vama Wovenfab has budgeted Rs 1.363 crore for first-floor shed construction and Rs 7.2452 crore for machinery, with both items proposed to be funded from net offer proceeds. The first-floor project involves constructing 1,626 square metres of unconstructed shed area, taking available first-floor area to 3,166.17 square metres. Vama Wovenfab says the additional area is needed for machinery and related operations.

The schedule assumes IPO proceeds are received in September 2026. On that basis, Vama Wovenfab expects construction to begin in September 2026 and the shed to be ready in February 2027; machinery purchase orders are also planned for September 2026, with delivery and use in February 2027. The company had not placed orders or signed definitive vendor agreements, while Lohia Corp Limited quotations were valid for 30 days and the S. K. Enterprises quotation for 45 days.

Vama Wovenfab says the estimates have not been appraised by a bank, financial institution or agency and may be revised for cost, market, business or regulatory changes. Cost escalation from freight, installation, packing, forwarding or customs duty is to be met through internal accruals. If offer proceeds are delayed, Vama Wovenfab may deploy internal accruals or borrowings, making financing timing relevant to the February 2027 commissioning plan.

How does working capital affect Vama Wovenfab's capacity plan?

Vama Wovenfab estimates net working capital of Rs 78.7886 crore for FY 2026-27, up from Rs 45.7937 crore at March 31, 2026. Net working capital is current assets less current liabilities: Vama Wovenfab projects current assets of Rs 93.5154 crore and current liabilities of Rs 14.7268 crore at March 31, 2027. It proposes to use Rs 26.50 crore of net offer proceeds, with Rs 52.2886 crore expected from internal accruals and borrowings.

The projected increase includes trade receivables of Rs 43.7582 crore at March 31, 2027, compared with Rs 18.4165 crore at March 31, 2026, while inventory is projected to decline to Rs 43.1525 crore from Rs 44.7785 crore. Vama Wovenfab assumes receivables will normalise to 67 days from 31 days in FY 2025-26, which it says reflected an exceptional customer recovery in March 2026. The operating outcome therefore depends on funding both machinery commissioning and a longer projected collection cycle.

Conclusion

Vama Wovenfab’s proposed addition of 62 looms expands fabric-making capacity around the planned restoration of tape availability and installation of winding equipment. FY 2025-26 data show 82% circular-loom utilisation, compared with 42% tape-plant utilisation and 26% utilisation in each bag-making category. Higher fabric output depends on the repaired tape line operating as planned and on sufficient demand through direct fabric sales, bag conversion or both.

The next disclosed milestones are purchase-order placement in September 2026 and machinery delivery and use in February 2027, each assuming IPO proceeds arrive in September 2026. Vama Wovenfab has not finalised vendor contracts, and quotation validity periods may expire before orders are placed. The eventual mix between fabric sales and bag processing, along with FY 2026-27 receivables projected at Rs 43.7582 crore, remains central to the capacity plan's execution.