Thursday, October 18, 2007

Despite rupee appreciation, home markets offer immense opportunities for Indian textile firms!

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Clearly, the sector is on a high and so are the companies. Raymond recorded a net profit of Rs.2.02 billion, mainly pushed by a JV with Belgium’s largest producer of high-end denim, United Cotton. Gautam Hari Singhania, Chairman & Managing Director, Raymond, adds, “We see continued growth in our textile and apparel business with our world-class vertically integrated facilities, strong product development and branding skills. In respect of our JVs, especially in denim, we are working closely with our partners to make the businesses realize their goals.”

Arvind Mills too, at a profit of Rs.1.19 billion, has been riding high after a joint venture with US-based VF Corporation, to design, market and distribute VF’s branded lifestyle apparel in India. But it was Gokaldas Exports that crossed the milestone of Rs.10 billion in apparel sales, a figure that has never been achieved by any Indian apparel firm. In this regard, Vivek Hinduja, CEO at Gokaldas Exports, shared with B&E, “The year 2006-07 enabled us to have a bigger global presence; and we have almost doubled our production capacity in this fiscal.” Expectably, in the time to come, we may see some more companies playing it big in the global arena. One can expect mid-sized companies too participating in this rally, after a series of measures announced in Union Budget 2006-07. The government provided support by allocating Rs.5.4 billion to the technology upgradation fund, giving interest subsidies on term loans up to Rs.2.4 billion, assigning Rs.1.9 billion for integrated textile parks, reducing excise & import duties, customs duties etc. Though the industry is currently going through a rough patch, as issues like rupee appreciation & slowdown in the US had a negative impact on exports, the domestic market offers immense opportunities. For once, India beckons!

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Source :
IIPM Editorial, 2007

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