Project detail - EPYLLION KNITWEARS LIMITED

Who is our customer

Epyllion Knitwears Ltd. (EKWL) is a textile company focusing on cutting,sewing and producing T-shirts and is part of the Epyllion Group (EG), comprising 8 textile companies. EG was established in 1993 and is now one of the top tier vertically integrated garment manufacturing and exporting groups in Bangladesh. EG produces T-shirts, Polo shirts and Sweat shirts and employs 12.600 people. Its operations cover the whole value chain of the garment manufacturing process from knitting to dyeing, washing, sewing and packaging. The Group comprises three textile clusters: (i) garment cluster, where the knitting and sewing is carried out, (ii) textile cluster, where fabrics are produced and washed and (iii) an accessories cluster. The fabrics produced in the textile cluster and the accessories are sold to companies within the garment cluster.

What is our funding objective?

The funds will be used to set up a new cutting, knitting and sewing factory, incorporating 50 lines, at a location 18 km outside Dhaka. The factory will be situated in an industrial belt, were a lot of other factories are being built, which attracts sufficient people looking for work. The project will increase the cutting and sewing capacity of the Group from 25 million to 43 million pieces per year. Currently, EG is focusing primarily on men's items. With the expansion, more value-added products such as women's and girl's items will be produced. These items generate higher margins and will also lead to a better customer diversification as much of the new products are expected to be sold to M&S, H&M, G-Star, Next and s'Oliver. These customers have requested EG to increase its capacity. The new factory takes into account their requirements.

Why do we fund this investment?

The project involves an investment in the Ready Made Garment industry in Bangladesh, an important sector, contributing to 14% of GDP and 81% of export earnings. With this project, 5.920 direct jobs will be created, mostly for women, at the base of the pyramid. FMO believes that supporting best-in-class operators in Bangladesh such as EG will demonstrate that ethical, responsible and successful apparel players exist and are vital in ensuring change throughout the industry. The Dutch Embassy, which is very active in the Ready Made Garment sector in Bangladesh confirmed that EG is one of the best textile companies in the country with respect to E&S issues. Additionality is derived from providing long term scarce capital which is not available from commercial banks. With this investment, FMO will support a strong group with a healthy balance sheet and sustainable margins.