'We expect 2009 to be a better year' – Mr Bhatia, Abhishek Inds Ltd
Mr. Rajneesh Bhatia, President, U.S. Marketing, Abhishek Industries Ltd.
In this second part of our series on the turmoil in the US economy affecting exports from the Indian textile and garment industry and to provide our readers a better perspective on the situation from honchos of leading export companies, we at fibre2fashion spoke to Mr. Rajneesh Bhatia, President, U.S. Marketing, Abhishek Industries Ltd., India.
Abhishek Industries Ltd. is a part of the well diversified North India based Rupees 15 billion Trident Group which has interests in textiles, chemicals, energy and paper and has operations spanning across 40 countries with a ratio of 50 percent in export sales to net sales. Within the textiles category, the group has two divisions: terry towels and yarn.
Abhishek Industries Ltd has recently won the silver prize at the recently held Texprocil awards ceremony for the second highest exports in the terry towels category and is also a recipient of many other awards including coveted SAP ACE (Award for Customer Excellence) - 2007 award for Best Textiles and Apparel Sector Implementation in the category of Midsize Enterprises.
Among other awards Abhishek has also received four times the "International Supplier of the Year” award from Wal-Mart, USA and “2006 Supplier of the Year" award from JC Penney Corporation.
Fibre2fashion: How do you foresee the effect of financial turmoil in US affecting Indian textile sector?
Mr Bhatia: The current financial crisis is generic and impacting the economy as a whole. The immediate impact would definitely be low availability of funds so we may not see much inorganic growth for a while of Indian companies in the US. The recent acquisitions that were conducted through the financial houses that are under question may also come under some strain. The more pressing concern for the Indian Textile sector is the dollar movement that has been erratic. Most companies in this sector dependant on exports have not been able to leverage the rising dollar rates to the best possible advantage.
fibre2fashion: Is there a significant change in demand from US customers in recent past due to the crisis in financial market?
Mr Bhatia: Demand in the US has been sluggish for quite a while and this phenomenon is not limited to textiles only. Despite a slowdown some products in respective categories have shown customer preferences and still have come out as winner in such a scenario. The good news is that we hear encouraging reports in the market and expect 2009 to be a better year.
Fibre2fashion: Do you think that focusing on European countries rather than US would be beneficial for Indian companies?
Mr Bhatia: Changing focus is not the answer. US is still a very lucrative market for the Indian sector. Many European countries also prefer to transact in US dollars that limits the hedging of the risk. Some Indian companies have grown phenomenally in size and same has been done keeping in mind retailers like Wal-Mart and Target as we do not have similar consumption patterns anywhere in the world as these retailers have owing to their size. As US dependent organizations try to focus on other parts of the world to mitigate risk it is sure that they will as a strategy not like to lose focus on what their potential can be in US.