Positive Outlook: ICRA Ratings forecasts 8 per cent YoY revenue growth for home textiles sector in FY24
29 November 2023, Mumbai
The combined revenues of key players in the home textile sector, including Welspun, Trident, Himatsingka, and Indo Count, are forecast to see an approximately 8 percent year-on-year increase, reaching Rs 215 billion in FY24, says an ICRA Ratings report.
KK Lalpuria, Executive Director and CEO of Indo Count Industries, emphasizes that the primary driver for this growth will be the escalating demand for premium and sustainable home textile products. Conversely, the demand for mass-produced home textile items is anticipated to remain at a moderate level.
Bracing up
Overcoming challenges such as elevated material and energy costs, alongside subdued demand in the US and EU markets, led to an 18 per cent decline in India's home textile exports in FY2023 and a subsequent 12 per cent decline in the initial four months of FY2024.
During these periods, the US claimed the largest market share in home textile exports, accounting for 56 per cent in FY2023 and 58 per cent in the initial four months of FY2024.
Quotes
Kaushik Das, Vice-President & Co-Group Head, Corporate Sector Ratings at ICRA, expresses optimism that India's home textile exports will receive a boost in the first four months of FY2024, driven by proposed Free Trade Agreements (FTAs) with the UK and the EU, existing FTAs with Australia and the UAE, and the China Plus One strategy adopted by major retailers.
Multiple data-points
Projections indicate that the export share of home textile products such as beds, tables, toilets, and kitchen linen will rise to 32–33 percent in the initial four months of FY2024, while exports of carpets and floor coverings are expected to surge to 31 per cent.
Additionally, the anticipated rationalization in raw material costs and advantages stemming from a larger scale is poised to elevate the operating margins of home textile exporters by 250–350 basis points, reaching 14.5–15.5 percent in FY2024.
