Lux Industries Launches Rs 600 Crore Expansion at Dankuni Facility

The investment aims to transform the West Bengal site into a global-scale garment manufacturing hub, significantly boosting production capacity and regional employment.

DANKUNI, WEST BENGAL – Lux Industries Limited has officially commenced a major expansion of its manufacturing operations in Dankuni, West Bengal, with a planned investment of Rs 600 crore. The project, which received board approval on July 4, 2026, is set to scale the company’s "Vertical A" unit into one of Asia’s largest integrated garment manufacturing hubs.

The foundation stone for the expansion was laid on July 11, 2026, in a ceremony attended by West Bengal government officials. This strategic move is designed to address current capacity constraints at the existing facility and meet the rising demand for hosiery and premium apparel across domestic and international markets.

Boosting Production and Technological Infrastructure

The expansion project involves adding 12 lakh square feet of manufacturing and allied infrastructure to the existing site, bringing the total built-up area to nearly 20 lakh square feet. According to company disclosures, the facility currently operates at approximately 80% of its 12 crore-piece annual capacity. The new investment is projected to add an additional 18–20 crore pieces in annual capacity, raising the unit's total output capability to 30–32 crore pieces upon completion.

The company is placing a strong emphasis on automation to enhance operational efficiency and maintain product consistency. By integrating advanced manufacturing technology, Lux Industries aims to combat rising labor costs and optimize its long-term cost structure. The project is scheduled to be implemented in phases over the next six years.

Economic Impact and Funding Strategy

Beyond increasing production, the project is expected to serve as a significant engine for job creation in West Bengal. Lux Industries estimates that the expansion will generate approximately 3,000 direct jobs and 6,000 indirect employment opportunities.

Regarding the financing of the Rs 600 crore investment, the company stated that the capital requirement includes the value of land acquired in recent years and roughly Rs 450 crore in fresh capital expenditure. Funding will be sourced through a combination of internal accruals and debt. To support this growth, the company has also noted capital preservation measures, including a voluntary dividend waiver by promoters for the 2025-26 fiscal year.

Official Sources

• Lux Industries Limited: Board of Directors and official company disclosures regarding the Dankuni expansion project and capex allocation.

• Government of West Bengal: Participation of state government officials in the July 11 foundation stone ceremony.

Why It Matters

The expansion marks a significant step for Lux Industries in strengthening its dominance in the organized innerwear market. With a projected incremental annual revenue of Rs 900–1,000 crore at full utilization, the investment reflects the company's long-term confidence in the premiumization of the Indian textile sector.

Key Facts at a Glance

• Total Investment: Rs 600 crore (including Rs 450 crore in fresh capital expenditure).

• Capacity Increase: Addition of 18–20 crore pieces, taking total annual capacity to 30–32 crore pieces.

• Employment: Expected to create 3,000 direct and 6,000 indirect jobs.

• Project Timeline: Phased implementation over approximately six years.

• Infrastructure: Addition of 12 lakh sq. ft. of space, for a total facility size of 20 lakh sq. ft.

Frequently Asked Questions

1. How is Lux Industries funding the Rs 600 crore Dankuni project?

The company is utilizing a mix of internal accruals and debt. Additionally, promoters have implemented a voluntary dividend waiver for FY26 to support capital preservation for the project.

2. What is the expected revenue impact of this expansion?

Once the expanded facility reaches optimum capacity utilization, the company anticipates an incremental annual revenue of Rs 900–1,000 crore.

3. When will the new manufacturing capacity be fully operational?

The project is planned to be executed in phases over a period of about six years.

Source: Lux Industries Limited, West Bengal Industrial Development Corporation, Textile Insights, Sahi Research.