Year Long Project - 2012
Industry Analysis & Company Analysis
Textile Industry – Readymade Garments & Arvind Mills
Table of Contents
Indian Textile Industry
Textile Value Chain
Impact of Union Budget 2012-2013
Strong demand, lower input costs to boost profitability
Cotton Yarn and Cotton
Profitability under Pressure
Corporate Social Responsibility
1. Textile Industry
2.1 Indian Textile Industry
India Textile Industry is one of the leading textile industries in the world. Though was predominantly unorganized industry even a few years back, but the scenario started changing after the economic liberalization of Indian economy in 1991. The opening up of economy gave the much-needed thrust to the Indian textile industry, which has now successfully become one of the largest in the world.
India textile industry largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns about 27% of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 3% to the GDP of the country. India textile industry is also the largest in the country in terms of employment generation. It not only generates jobs in its own industry, but also opens up scopes for the other ancillary sectors. India textile industry currently generates employment to more than 35 million people.
Indian textile industry can be divided into several segments, some of which can be listed as below: * Cotton Textiles
* Silk Textiles
* Woolen Textiles
* Readymade Garments
* Hand-crafted Textiles
* Jute and Coir
2.2 Current Scenario
The Indian textile industry contributes about 14 per cent to industrial production, 4 per cent to the country's gross domestic product (GDP) and 17 per cent to the country’s export earnings.
The industry provides direct employment to over 35 million people and is the second largest provider of employment after agriculture.
Fabric production rose to 60,996 million sq. meters in FY 2011 from 52,665 million sq. meters in FY 2007 Production of raw cotton grew to 32.5 million bales in FY11 from 28 million bales in FY07, while production of man-made fiber rose to 1,281 million kgs in FY11 from 1139 million kgs in FY07. Production of yarn grew to 6,233 million kgs in FY11 from 5,183 million kgs in FY07.
India has the potential to increase its textile and apparel share in the world trade from the current level of 4.5 per cent to 8 per cent and reach US$ 80 billion by 2020.
Exports of textile grew to USD26.8 billion in FY10 from USD 17.6 billion in FY06. India’s textile trade is dominated by exports with a CAGR of 6.3 per cent during the same period
2.3 Textile Value Chain
The Textiles Value chain, in which processed fabrics are converted into ready-to-wear apparel, begins with 'spinning', in which fiber is converted into yarn. The yarn spun through the process of spinning is called spun yarn. Yarn which does not require spinning is called filament yarn.
The yarn is then converted into fabrics through 'weaving' or 'knitting'. The fabric undergoes various processes (commonly clubbed under the term 'processing') like scouring, bleaching, mercerizing, dyeing / printing, washing, finishing etc. The fabric produced after...
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