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Home textile industry to sustain growth in 2021: Ind-Ra

May 25, 2021
Home textile industry to sustain growth in 2021: Ind-Ra

New Delhi

As per Ind-Ra, when it comes to home textiles, it is expected that stable raw material prices and a sustained demand can bring about growth in exporters’ top line and bottom line. As per the report generated, home textile players saw a good and healthy rise in the top line in the year 2021 but the operating margins were quite affected in the fourth quarter of the same year. This effect was due to factors like increasing import duty on cotton, uncertainty over remission of duties, and taxes on the incentives generated on export products.

Due to lockdowns in various cities and industries, prices of cotton were corrected in the month of April. This was on the account of lower demand from mills that were operating with lower capacities due to the current pandemic scenario.

Also, according to the report, the United States Department of Agriculture Foreign Agricultural Service (USDA-FAS) is expecting that the domestic crop will increase by 2% year on year in the new season that will commence in October 2021. Having said this, the consumption is expected to increase by 6 to 8% year on year, which will lead to a reduction in the overall ending stock.

Finally, as per the report, there is a marginal increase in the production that is supported by a good monsoon season, which has further led to an increase in the yield by 5% to 497 kg per hectare. This marginal increase is despite the expected lower area under cultivation for the coming season. In conclusion, it can be said that if the prices of raw materials stay stable and the demand is sustained, the home textile industry will see a boost.

Source – The Times of India

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