Festivals to boost textile sales but China imports a concern - While rising input costs concern among retailers, about 54% of respondents in CMAI survey said they were absorbing costs by cutting margins; only about 35% have increased prices. M. Soundariya Preetha reports from Coimbatore apparel industry has entered festive season on positive note, with 52% of Cloth Manufacturers Association of India members expecting higher sales than last year. However, there are concerns among apparel makers in Tiruppur about rising garment imports from China.
According to recent survey by CMAl among its members numbering close to 7,000 including major retailers and brands, almost 30% respondents expect sales this year to match last year's performance, just less than 20% expect decline. Former president and chief mentor Rahul Mehta said in prelude to Diwali season, eastern States did well for Dasara offtake. However, sales in southern States for Navrathri was sluggish in north and west.
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"Despite textile inflation of 5%-7%, we think festival season this year will be better than last year. Raw material prices have started coming down and global geopolitical situation not as bad as few months ago. Sales expected to pick up across country closer to Diwali," he said.
CMAI said in statement strong order bookings by retailers at National Garment Fairs further reinforced industry's confidence. While rising input costs concern among retailers, about 54% respondents said they were absorbing costs by cutting margins and only about 35% had raised prices. This indicates higher festive sales could come with continued pressure on profitability, CMAI said. Indian wear expected to lead festive-season growth followed by western casual wear. Online apparel sales also expected to gain momentum.
Rising China imports - Meanwhile, according to R. Dhamodharan, secretary of South India Hosiery Manufacturers Association, import of cotton readymade garments from China during April-August was worth Rs 508.64 crore against Rs 283.65 crore for same period last year. Several traders placing orders in China and importing garments now. Further, distributors and consumers may not absorb price increase now. So manufacturers in Tiruppur looking at revising prices after festival.
SEBI eases rules for early share delivery - SEBI on Thursday amended Early Pay-In rules to ease margin requirements for stockbrokers and investors, allowing value of shares delivered early to be recognised towards margin obligations. Revised framework will come into effect February 22, 2027, giving brokers and clearing corporations four months to upgrade systems. Early Pay-In allows investors selling shares to transfer them to clearing corporation before scheduled settlement date. Value of securities delivered early can be used to meet margin requirements for corresponding sale, reducing need to provide additional funds. Under revised rules, clearing corporations will calculate accepted EPI value. This value will be lower of value of securities delivered early or value of securities sold. For investors taking buy and sell positions in cash market on same day, clearing corporations will calculate margin requirements after deducting accepted EPI value. Brokers will not have to collect additional margin for these positions to extent covered by accepted EPI value.
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Analytically, two business stories same page - one shows festive consumption holding despite inflation, other shows regulatory easing to boost market efficiency. Both indicate economy in consumption-led recovery, but China import surge shows Atmanirbhar still weak in textiles, which employs 45 million. If Chinese garments at Rs 283 crore to Rs 508 crore in one year, doubling, Tiruppur's 10,000 units at risk.
Tags: #Textile #CMAI #Chinalmports #Tiruppur #DiwaliSales #Inflation #SEBI #EPI #Retail #Apparel