Shasha Denims set to expand its production capacity by 10 lakh yards

Export-oriented Shasha Denims mainly engaged in manufacturing different types of classical indigo denim (denim fabrics) through the integrated manufacturing process of weaving, dyeing and finishing. As part of its expansion plan the company would be expanding its production capacity by 10 lakh yards to 28 lakh yards in the next one and a half years.

In line with the expansion, modern machinery will also be installed that will improve the quality of denim fabrics, said Jamal Abdun Naser, director of the leading denim fabric producer based in Dhaka Export Processing Zone.

As it got regulatory approval in October to raise funds from public, the company will raise Tk 175 crore through the IPO, with 88 percent of the fund to be spent on the expansion project.

The denim producer will offload five crore ordinary shares at an offer price of Tk 35, including a premium of Tk 25 for each Tk 10 share. The IPO subscription will begin on December 14 and end on December 21.

According to Naser, there is a huge demand-supply gap for denim fabrics both at local and international markets . Being one of the high quality denim fabric producers in the country, they want to exploit the opportunity.

Every month, 25 local makers produce 30 million yards of denim fabrics while the demand is nearly 60 million yards. To fulfill the demand, 30-35 million yards of such fabrics are imported every month at $75 million on an average from different countries, including China, India and Pakistan.

Shasha has around 15 percent of Bangladesh’s market share , after Partex Denims with 17 percent, followed by Envoy Denim with around 13 percent.

Bangladeshi entrepreneurs also supply denim to major retailers and brands, including H&M, Uniqlo, Levis, Nike, Tesco, Wrangler, s.Oliver, Hugo Boss, Puma, Primark, JC Penney, C&A, Tommy Hilfiger, Inditex, Walmart, M&S, Calvin Klein, Diesel, Gap, Channel, Dior and G-Star.

Buying denim fabrics from local sources is a major way for manufacturers to reduce lead time for shipment. So, they are focusing on producing quality denim fabrics that will help the local users be more competitive in the international markets .”

The main raw material used for the production is yarn, which the company imports mainly from China, India and Pakistan.

Shasha Denims was incorporated as a private limited company in 1996 and converted into a public limited company in the next year.