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AUGUST 2015
Executive Summary......3
Advantage India....5
Strategies Adopted23
Growth Drivers...25
Opportunities..38
Success Stories..41
Useful Information..47
AUGUST 2015
141
100
67
2014
2017E
2014
2017E
2021E
2021E
CAGR: 10.8%
65
2017E
2014
2017E
2021E
AUGUST 2015
112
63.5
33
2014
2015(P)*
2021E
CAGR: 20.8%
82
40
2014
2017E
Source: Ministry of Textiles, Make in India, Technopak, TechSci Research
Notes: CAGR - Compound Annual Growth Rate, E Estimate, P Provisional
* Indicated- 2015- up to Sept 14
CAGR: 1.7%
4.25
4.18
Policy support
AUGUST 2015
ADVANTAGE INDIA
AUGUST 2015
2014
Market
Value:
USD99
billion
Competitive
advantage
Increasing investments
Advantage
India
Market
Value:
USD226
billion
Policy support
Under
Union
Budget
2015-16,
government has allocated USD39.81
million for integrated parks in India
2023F
Source: PHD Camber of Commerce; Federation of Indian Chambers of Commerce and Industry, TechSci Research
Notes: SITP - Scheme for Integrated Textile Park; FDI - Foreign Direct Investment,
ASEAN - Association of Southeast Asian Nations, E Estimate
AUGUST 2015
19011950
1854-1900
AUGUST 2015
Number
of
mills
increased from 178 in
Notes: NTP - National Textile Policy; NTC - National Textiles Corporation; ASEAN - Association of Southeast Asian Nations,
TUFS - Technology Upgradation Fund Scheme; TMC - Technology Mission on Cotton, EU - European Union
Source: Union Budget 2015-16, Make In India
Raw
material
Output
Cotton,
jute, silk,
wool
Ginning
Fibre*
Spinning
Yarn
Weaving/
knitting
Processing
Garment/
apparel
production
Fabric
Processed
fabric
Final
garment/
Apparel
Woollen textiles
Silk textiles
Jute textiles
Technical textiles
AUGUST 2015
Indian textile industry accounts for about 24 per cent of the worlds spindle capacity and 8 per cent of global rotor capacity
India has the highest loom capacity (including hand looms) with 63 per cent of the worlds market share
India accounts for about 14 per cent of the worlds production of textile fibres and yarns (largest producer of jute, second
largest producer of silk and cotton; and third largest in cellulosic fibre)
Source: Textile Ministry, Make in India, TechSci Research
AUGUST 2015
10
226
CAGR: 8.7%
70
2009
89
99
2011
2014
78
2010
2023E
AUGUST 2015
11
Apparel
AUGUST 2015
Textile
69%
12
CAGR: 2.9%
33.9
30.7
28
29
35.3
35.6
35.9
35.3
FY12
FY13
FY14
FY15*
30.5
FY07
FY08
FY09
FY10
FY11
Raw cotton and man-made fibres are major segments in this category
Raw wool and raw silk are other components their production levels are much lower
AUGUST 2015
13
1.27
1.24
1.29
1.23
1.26
1.28
FY12
FY13
FY14
1.14
1.07
FY07
FY08
FY09
FY10
FY11
AUGUST 2015
14
489.11
427.98
385.06
346.03
350.2
FY11
FY12
FY13
FY14
*FY15
AUGUST 2015
15
10,006
35,439
17,874
9,283
33,871
18,812
8,468
30,570
20,567
8,135
31,201
21,663
7,769
28,790
22,438
6,766
26,898
20,534
27,196
21,173
26,238
19,545
6,882
6,888
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
Cotton
Blended
AUGUST 2015
16
31.7
33.3
22.4
3.04
2.7
5.4
5.2
4.2
3.4
3.5
14.6
21.2
22.1
3.3
17.6
19.1
2.8
2.7
27.8
35.4
FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14* FY15*
Exports
Imports
AUGUST 2015
17
10%
Cotton Textiles
3%
40%
16%
31%
Handicrafts (Carpet,
Handloom, Coir,
Handicrafts excluding
carpets)
Others (Silk, Wool,
Jute)
AUGUST 2015
18
Business areas
Vardhman Group
Raymond Ltd
AUGUST 2015
19
Increasing investment in
TUFS
Multi-Fibre Arrangement
(MFA)
Public-Private
Partnership (PPP)
With the expiry of MFA in January 2005, cotton prices in India are now fully integrated with
international rates. In 2014, the government has cleared 13 proposal of new textile parks
in different states.
The Ministry of Textiles commenced an initiative to establish institutes under the PublicPrivate Partnership (PPP) model to encourage private sector participation in the
development of the industry
Technical textiles
Technical textiles, which has been growing at around twice the rate of textiles for clothing
applications over the past few years, is now expected to post a CAGR of 20 per cent over
FY11-17
USD70.83 million has been allocated to promote the use of Geotechnical textiles in the
North East states. In FY14
AUGUST 2015
20
Threat of New
Entrants
(High)
Substitute Products
Bargaining
Power of
Customers
(Moderate)
Competitive
Rivalry
(Moderate)
Substitute
Products
(High)
Bargaining
Power of
Suppliers
(Low)
AUGUST 2015
22
STRATEGIES ADOPTED
AUGUST 2015
Focus on backward
integration
Welspun India plans to increase its internal supply of yarn and greige from ~35 per cent in
February 2014 to 70-75 per cent by June 2014, through its backward integration strategy
Focus on forward
integration
Vardhman Textiles Ltd has entered into garment manufacturing business through a
collaboration with Nisshinbo, a Japanese manufacturer of yarns
Raymond group under its group company J.K.Helene Curtis is looking to ramp up male
grooming segment by unleashing new variants of shampoos and deos
Diversification
AUGUST 2015
24
GROWTH DRIVERS
AUGUST 2015
Increasing investments
Policy support
Growing demand
Growing domestic
and foreign
investments
Rising demand in
exports
Inviting
Resulting in
Increasing demand
in domestic market
due to changing
taste and
preferences
Government setting
up SITPs and Mega
Cluster Zones
Commitment of
USD140 billion of
foreign investments
Growing population
driving demand for
textiles
Increasing loans
under TUFS
Government
investment
schemes (TCIDS
and APES)
AUGUST 2015
26
Stress on
mechanisation
Union Budget
Some of the key tax reliefs
in Budget FY16:
Zero excise duty for the
cotton products
Structure of the excise
duty on Man-Made Fibre
has been same
Infrastructure
support
Allocation of USD39.8
million for apparel parks
under SITP
USD26.05 million have
been allocated for NER
Textile Promotion
Scheme
USD1.33 million has
been allocated to Trade
Facilitation Centre and
Craft Museum
AUGUST 2015
27
CAGR: 1.8%
1.2
1.26
1.34
1.03
0.85
0.69
1980
1990
2000
2010
2014
2019F
AUGUST 2015
28
2500.0
8.0%
2000.0
6.0%
2302.5
2128.8
1978.7
1832.8
1702.1
1584.3
500.0
1504.5
2.0%
1514.6
1000.0
1552.5
4.0%
1430.2
1500.0
0.0
15%
26%
50%
32%
40%
29%
35%
25%
0.0%
2%
-2.0%
12%
1%
2008
6%
2020
3%
17%
7%
2030
-4.0%
Income
segment
(USD)
Globals (>22065.3)
Seekers (4413.1 - 11032.7)
Deprived (<1985.9)
Growth Rate
Source: IMF, Mckinsey Global Institute, TechSci Research
Notes: E - Estimates, F - Forecasts
AUGUST 2015
29
33.3
CAGR: 9.13%
35.4
31.7
27.8
22.2
21.1
FY08
FY09
19.2
24.1
22.4
FY10
FY11
FY12
FY13
FY14 FY15*
AUGUST 2015
30
32
CAGR: 9.6%
14
FY14
FY23E
AUGUST 2015
31
CAGR: 8.3%
5.5
4.7
AUGUST 2015
2014
2016E
2021E
32
Foreign Direct
Investment
TUFS for the textile sector to continue in the 12th Five Year Plan with an investment target
of USD24.8 billion
Investment was made to promote modernisation and up-gradation of the textile industry by
providing credit at reduced rates
The policy was introduced for the overall development of textile industry
Key areas of focus include technological upgrades, enhancement of productivity, product
diversification and financing arrangements
FDI of up to 100 per cent is allowed in the textile sector through the automatic route
Technical textile
industry
AUGUST 2015
SITP was set up in 2005 to provide necessary infrastructure to new textile units; under
SITP, 40 projects (worth USD900 million) have been sanctioned
The planned outlay for the textiles and apparel sector under the 11th Five Year Plan
(2001217) was USD2.9 billion
Government of India has planned an increase in the fund outlay for technical textiles
industry to more than USD117 million during the current 12th Five Year Plan (2012-17)
33
State
Tamil Nadu
Area
(hectares)
607.1
Sector
Details
Apparel and
fashion
accessories
Gujarat
56.0
Textiles
Brandix India
Apparel City (BIAC)
(Functional)
Andhra
Pradesh
404.7
Textiles
Several sectors
(KIADB)
(Functional)
Karnataka
16,129.0
AUGUST 2015
34
AUGUST 2015
35
Acquirer name
Target name
NA
NA
Grasim Industries
360.0
Madura Garments
Pantaloon Retail
333.3
Himachal Fibres
NA
721.1
Group of investors
Provogue (India)Ltd
526.9
Maxwell Industries
8.5
Source: M&A, Thompson ONE Banker, Grant Thornton, CMIE, TechSci Research
Note: * The value for 290 deals were not disclosed
AUGUST 2015
36
1587.83
1,647.09
1424.92
1226.02
1122.17
956.97
817.26
AUGUST 2015
FY10
FY11
FY12
FY13
FY14
FY15
FY16*
37
OPPORTUNITIES
AUGUST 2015
AUGUST 2015
of a domestic foothold,
outsourcing will also rise
significantly
39
is expected to grow at a
Compound Annual Growth Rate
(CAGR) of more than 13 per cent
over a 10-year period
Foreign investments
The government is taking
Notes: BTRA - The Bombay Textile Research Association, SITRA - South India Textile Research Association,
NITRA - Northern India Textile Research Association, SASMIRA - Synthetic & Art Silk Mills Research Association
AUGUST 2015
40
SUCCESS STORIES
AUGUST 2015
Retail
JV with GAS in
India - 2007
Furnishings
Acquisition of
ColorPlus 2002
Corporate wear
Capacity of 40
MM -1996
Woollen outerwear
Organic
growth in
textiles
Apparels
FY15
USD891.59
million
turnover
FY08
USD595
million
turnover
1980
Transformed
into industrial
conglomerate
1964
Vertical
integration in
multi-fibres
Fabrics
1925
1958
1964
1968
1990
1996
2000
2002
2006
2007
2008
2010
2011
2012
2013
2014
2015
AUGUST 2015
42
Polyester yarn
Home textile
Tie-ups With
Global Retail
Giants
Embroidery
Apparel fabric
Organic growth
in textiles
1986
1988
1990
1992
1993
1995
2003
1995*
Financial and
technical
collaboration
through JV
Cotton and
blended yarn
FY15
~USD4.01
billion
turnover
2004
2006
2007
2008
2010
2011
2012
2013
2014
2015
AUGUST 2015
43
Global
brand
Wide
distribution
network
Terry towels
Focus on
innovation
Growth
strategy
Focused
approach
on home
textiles
Association
with top
brands and
clients
Rugs
Location - Anjar/Vapi
Location - Anjar
Location - Vapi
AUGUST 2015
44
CAGR:
12.2%
CAGR: 24.2%
170.09
725
672
612
495
118.54
537
100
77
FY10
FY10
FY11
AUGUST 2015
FY12
FY13
FY14
FY15
65
FY11
FY12
FY13
FY14
FY15
45
CAGR: 8.3%
2.4
2.5
3.0
2.7
2.5
2.4
2.6
2.4
1.9
1.4
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
AUGUST 2015
46
USEFUL INFORMATION
AUGUST 2015
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