Garment sector needs lots of investment to become growth engine
ATE has a formidable presence in textile engineering, both in conventional and technical textiles. The company provides a wide range of textile machinery and accessories across the textile value chain along with a comprehensive range of utilities. Gurudas Aras, director (textile engineering group) at ATE Group provides interesting insights into the Indian textile machinery market and discusses the latest developments in the company.
Where does the Indian textile industry stand in terms of technologies and machines being adopted?
As far as the status of the textile industry is concerned, the spinning is quite up to date in the sense that nearly over 70 per cent capacity is quite modern. However, the situation in weaving and processing is quite opposite. Both these sectors are still weak links in the textile value chain. These sectors, being in the hands of the unorganised sector to a large extent, have not been modernised for long. For the last couple of years, some modernisation efforts have started following government incentives. Due to the weak links in the value chain, India is not able to succeed much in the global market except for the yarn. As far as the garment sector is concerned, it cannot give required volumes to buyers due to smaller capacities. The garment sector needs lots of investment if garments are to become the growth engine of our textile industry much like that of China.
What is the market size of the Indian textile machinery? At what rate is it growing?
The overall market for the textile machinery in India is approximately `1,600 crore in my estimate. Out of this, only 30 per cent of the requirement is met by the domestic textile machinery makers, while nearly 70 per cent of the machinery gets imported mainly from Germany, Japan and China. For spinning, Indian suppliers can more or less meet the requirement. However, in weaving, processing and garmenting, a majority of the equipment is being imported. The growth of the textile machinery market is cyclical in the range of 3-5 per cent in my estimate.
What is the percentage of textile machinery being made in India? Do you see it growing?
As I mentioned earlier, hardly 30 per cent of the requirement is met by the Indian textile machinery sector and that too mainly in spinning and partly in processing and utilities. The capacity utilisation of the Indian textile machinery industry is only around 60 per cent. I do not see it growing unless there is technology transfer to India from Europe and Japan, and machines are made in India. There is especially great scope to make highspeed weaving machines in India in view of sustainable demand and in terms of larger volumes to the tune of 4,000-4,500 machines per year.
What is the demand for technical textile machines in India? Which machines are Indian manufacturers sorting for this purpose?
The demand for technical textile equipment is growing at a very slow pace. Almost all the machinery is imported from Europe and at low-end from China. Due to the high cost of the technology so far, many technical textile players preferred to import second hand machinery or went for low technology Chinese equipment. Since the government is encouraging investments in the technical textiles sector, corporates have started looking at it more seriously and some business houses have already invested in manufacturing of products like fabrics for windmill blades, flex banner fabrics, carbon and glass composites. Most of the machines bought by the manufacturers are from Europe-mainly from Germany-as these are very high end technologies restricted to few players.
What new technologies and innovations can be expected for machines used in the apparel industry, and with sustainability as a given?
The garment industry in India has been suffering for decades due to wrong government policies of encouraging small sector manufacturing rather than building bigger capacities. Due to this, India has missed the bus while China has taken a big lead; even Bangladesh and Vietnam have run forward faster now. The need of this industry is automation and bigger set-ups. The technologies are available, but the sector is highly labour-intensive. With the new government encouraging investments in the garment sector, newer technologies and automation will soon become the order of the day. The skill enhancement and training is also vital in this sector for improving quality and productivity, and have a sustainable advantage. New technologies that can be expected to find acceptance would be automatic cutting and spreading, automatic transportation of material, laser finishing, washing machines with lower liquor ratios thus reducing water consumption.
How have Indian manufacturers received systems integrated with IoT? To what extent does this technology persist within the Indian textile industry when compared to geographies like China, Vietnam and Bangladesh?
Compared to the other industries in India, the acceptance of IoT is much slower in the textile industry; the reason being that the industry still follows conventional processes of production and monitoring. However, with the new generations entering the industry, who are much more open to new ideas and new technologies, this will change. I am sure that shortly the industry will recognise the need of using IoT for better monitoring of the production and other processes and also big data analytics will be the next thing to come into the industry. One of our group companies- EcoAxis-is already in this fast expanding business, and we have started offering remote monitoring solutions to the textiles industry.
That robotics will revolutionise manufacturing is the latest buzz. What are your thoughts on this?
Certainly robotics is the future of manufacturing. However, for an industry like textiles, it might take some time to get robotics introduced on a big scale. Automation has been fast picking up over the last couple of years. Looking at the increasing costs of labour as well as availability issues in India, there is a huge scope for automation in our industry. In what kind of machines are Indian garment manufacturers investing more? The garment industry is investing more in cutting room automation, laser finishing, special garment washing machines, as well as special garment finishing equipment.
Which latest machines in garment manufacturing have high demand in India?
Automation in garment making, finishing for jeans, garment washing and laser finishing are the machines in more demand especially those which come with the latest technologies. Different washing and finishing techniques are fast adopted by Indian garment makers.
What kind of post-sale services do you offer?
At ATE, we lay great emphasis on after-sales service. We have nearly 60 service engineers catering to aftersales service covering erection and commissioning, troubleshooting, technology support as well as machine audits and annual maintenance contracts. Many of our engineers are trained at our foreign principals' factories and they are also utilised by our European principals across the world for service because of their expertise. After-sales service being one of the strongest points for ATE, many customers prefer to buy machines from us.
Which new technologies do you plan for the textiles industry in India in the near future?
ATE has expanded considerably over the last three years since we pursued the philosophy of 'end-to-end solutions' across the entire textile value chain. In that pursuit, we have succeeded in filling many product gaps by bringing in some latest technologies to India. In view of the product folio expansion in the textile machinery segment over the last couple of years, we are at present busy focusing on consolidating these different business verticals rather than looking out for new technologies. We are also busy promoting some of our home-grown technologies to the textiles industry.
Our group company, ATE Envirotech has developed patented AAA wastewater treatment technology, which is based on biological treatment and is fast being accepted in the industry. We have many leading textile companies like D'Decor, Tessitura Monti, Creative, LNJ Denim, Sangam, Dicitex Décor, Mandhana and Jayavishnu as our customers. Similarly, we are focusing on promoting remote monitoring systems (IoT and big data analysis solutions) from our other group company EcoAxis to our big textile customers, who have multiple locations and multiple processes for manufacturing.
How did you fare in the last two fiscals, and what are your expectations for the next two?
The last fiscal 2015-16 had been one of the best years for ATE as far as textile engineering group is concerned. Our spinning, fabric forming and processing business groups have done very well. The business of Truetzschler India for blow room, carding and draw frames, warp knitting and warp preparation business of Karl Mayer, Germany have done very well. Similarly, in processing, most of our principals like Fongs, Monfongs, Goller, Monforts, Zimmer, Mahlo, Corino, Stalam, Ramisch, Osthoff and Color Service have done very well in the last year with higher market shares.
Although the market in the current fiscal is not as good as last year due to increasing cotton prices, certain segments like processing continue to attract investments due to which our processing business continues to do well. The current year will not be as good as last year business-wise, but we are sure that we will do well since we have some new agencies like Savio automatic winders in our armoury which will help us increase our market share in spinning over and above the market leadership enjoyed by Truetzschler India.