Uncertain environment does not deter Indian textile makers

Of the results of around 136 companies available as on date, aggregate sales of more than 57 companies have gone up by 10 percent from a year earlier. Again of these 136 companies, 41 companies have posted a net profit growth of more than 10 percent years on year. Companies into yarn, home textile and denim have performed well in this quarter.

Among companies who chalked impressive growth in sales in Q1 were Damodar Threads 66 percent, Welspun India 48 percent, Winsome Yarn 41 percent, Banswara Syntex 28 percent, MSUM India 24 percent, JBF Industries 31 percent, Lambodhara Textiles 26.58 percent, Nakoda Textile 22 percent, Sangam India 22 percent, Indo-Rama Synthetics 21 percent and more.

However, Mr DK Nair – Secretary General of Confederation of Indian Textile Industry (CITI) brushes aside results of the few companies which delivered better results. He says, “We have to take the bigger picture in to account. Most of the companies in the Indian textile industry are bleeding. Although we welcome the results of the few who have bucked the overall trend”.

He adds, “Most of the companies which have delivered better results are vertically integrated companies, like Welspun, Arvind, to name a few. However spinners like Vardhman which have never declared losses since inception have posted losses in the quarter. The hardest hit are standalone units like spinning, weaving or apparel producers”.

A few of these companies have reported handsome growth in revenues as well as net profits in the reporting period. Welspun India for instance has clocked revenue growth of 48.06 percent, while net profits have also hiked 45.84 percent, both from a year ago. Mumbai based Sarla Performance Fibres too has posted sales and net profit growth of 34.02 and 23.45 percent respectively.

Speaking about their performance, Mr. Rajesh Mandawewala, MD of Welspun India revealed, “Consolidation of our operations and optimization of resources has enabled us to deliver superior performance despite a troubled global economy. The large scale of our operations and constant innovations in products has helped us steer through difficult periods”.

Mr Mahen Sheth – CFO at Sarla says, “Revenues have increased 34 percent mainly due to an increase in the volume of sales coupled with the USD appreciation. Secondly, we deal in high tenacity specialized yarns, which are a niche segment and which in turn reduces the risk to a certain extent of local or global factors. We are also confident of maintaining the same pace in coming quarters”.

Mumbai-based yarn producer - Damodar Threads posted a year on year sales growth of 66.40 percent and a rise in net profits of a stupendous 1316 percent in the quarter. Aditya Biyani from the promoter family said, “The main reason for surge in revenues has been optimization of production and marketing. Our continuous efforts in the export market have helped us develop new markets and sales.