
Vinod Gupta, , shares some insights on the state of India's hosiery industry in the wake of rising cotton and yarn prices. Edited excerpts from his interview to ET Now:
ET Now: Cotton prices in India have risen 5% in the past one month alone. Is the industry feeling the heat because of this uptick?
Vinod Gupta: Although prices are currently mostly stable, cotton has in fact risen by 30% since last October. But yarn prices have jumped even more sharply — by some 50%.
That price jump has not stopped yet; in March alone, yarn prices have gone up by Rs 30-35 a kg, which is around 10%.
The gap in prices of cotton and cotton yarn will impact the entire hosiery industry. MSMEs and mid-sized hosiery businesses will be impacted most significantly, because of (i) short supply from spinning mills owing to price rise, and (ii) increase in demand for working capital.
MSMEs will remain majorly hit until the government puts a cap on yarn prices. Requests have been sent to the government, but there is no news from the Textile ministry yet. Prices, meanwhile, have continued to rise steeply.
ET Now: What about the demand in segments such as Athleisure Innerwear? Demand is rising as offices are reopening. What kinds of gains have you made in terms of revenue and market share?
Vinod Gupta: The demand for Athleisure products has been very good. People working from home have taken to these products big time. Those who've begun going to offices have also had a role in pushing up demand.
Athleisure is seeing robust demand now, and we hope good demands in the future as well.
ET Now: Do you see any negative factors hurting business in near future — like, say, a dip in volume? Also, how do you view potential threats from unorganised players?
Vinod Gupta: Any dip in volume is unlikely because we are only going to intensify our efforts to capture the market even more, especially in view of the oncoming marriage season. Ramadan and Eid are also in the months of April and May.
That means that demand is likely to remain strong, and that whatever price increases we and other players have done so far are going to stay.
I do not think there will be a threat from the unorganised sector. The rise in raw material prices as well as the jump in demand for working capital have impact this sector even more adversely.
As far as I can see, the unorganised players are in a much deeper hole than their organised peers.
ET Now: Any new launches that we can look forward to?
Vinod Gupta: Not at the moment. Athleisure is currently at the heart and centre of all our efforts, not least because there are some bottlenecks in the production scenario.
Under Athleisure we have two types of ranges — one for the mid segment and the other for the high scale. We are putting our best efforts to bring in more and more fashion into both of these ranges with the aim of increasing our market share as fast as we can.
ET Now: Cotton prices in India have risen 5% in the past one month alone. Is the industry feeling the heat because of this uptick?
Vinod Gupta: Although prices are currently mostly stable, cotton has in fact risen by 30% since last October. But yarn prices have jumped even more sharply — by some 50%.
That price jump has not stopped yet; in March alone, yarn prices have gone up by Rs 30-35 a kg, which is around 10%.
The gap in prices of cotton and cotton yarn will impact the entire hosiery industry. MSMEs and mid-sized hosiery businesses will be impacted most significantly, because of (i) short supply from spinning mills owing to price rise, and (ii) increase in demand for working capital.
MSMEs will remain majorly hit until the government puts a cap on yarn prices. Requests have been sent to the government, but there is no news from the Textile ministry yet. Prices, meanwhile, have continued to rise steeply.
ET Now: What about the demand in segments such as Athleisure Innerwear? Demand is rising as offices are reopening. What kinds of gains have you made in terms of revenue and market share?
Vinod Gupta: The demand for Athleisure products has been very good. People working from home have taken to these products big time. Those who've begun going to offices have also had a role in pushing up demand.
Athleisure is seeing robust demand now, and we hope good demands in the future as well.
ET Now: Do you see any negative factors hurting business in near future — like, say, a dip in volume? Also, how do you view potential threats from unorganised players?
Vinod Gupta: Any dip in volume is unlikely because we are only going to intensify our efforts to capture the market even more, especially in view of the oncoming marriage season. Ramadan and Eid are also in the months of April and May.
That means that demand is likely to remain strong, and that whatever price increases we and other players have done so far are going to stay.
I do not think there will be a threat from the unorganised sector. The rise in raw material prices as well as the jump in demand for working capital have impact this sector even more adversely.
As far as I can see, the unorganised players are in a much deeper hole than their organised peers.
ET Now: Any new launches that we can look forward to?
Vinod Gupta: Not at the moment. Athleisure is currently at the heart and centre of all our efforts, not least because there are some bottlenecks in the production scenario.
Under Athleisure we have two types of ranges — one for the mid segment and the other for the high scale. We are putting our best efforts to bring in more and more fashion into both of these ranges with the aim of increasing our market share as fast as we can.
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3 Comments on this Story
Abhinav 2 hours ago Banks have to Play a Crucial role to promote Automation & Digitization & bankers need to get educated on Technology & Modern Trade both . PM Modi has rightly setup a Textile & Garment training Institution in “Varanasi” which is the Hub of Sarees. Bhadoi & Gorakhpur have Carpet & Garment units. Some townships should be targeted to train Youngsters to start Metal fabrication units , Fibre Making , Growing , Cotton seeds, Spices Cultivation , Fruits & Vegetable Growing , Timber Growing, . Retail Giants IKEA is about to set up its first retail centre in Noida. | |
Abhinav 2 hours ago Digitization & automation should not remain Limited to large Industries but Benefits of Digitization & automation must reach Tier 11 & tier 111 Cities & villages - to ordinary Artisans & to small Garment units. Digitization, IOT & Automation should not remain as Topics to be discussed only on Media Summits but Modern Hardware & Software should reach ordinary Entrepreneurs. Prime Minster Modi emphasized on Industry 4.0 when he visited Germany & now we have Dynamic Textile Minister. Automization of Printing & Embroidery, of Cutting & Sewing Operations is a necessity today to remain competitive & profitable. Some UP townships have to Mimic – “Karnal the Textile Hub of Haryana, “Coimbatore of Tamil Nadu” “Surat” for embroidery & textile, “Morbi” for Sanitaryware items in Gujrat. The Industrialization Model of these towns can be replicated in UP townships | |
Abhinav 2 hours ago Mission purvanchal the rising East on 13th March is a Good Article. Accomplishments by Yogi aditynath Govt are Inspiring. UP has large Population & a Bigger land area & UP has rightly Exploited its larger land area to its advantage. With State Elections approaching UP admiration is rightly Concentrating on Region wise development. Good quality Soil is Conducive to large scale farming & UP has Identified those Soil Rich Regions. Rivers are flowing in UP & rainfall is Normal. UP Govt under leadership of PM Modi is rightly Investing in Agri & Food processing Sector. “ODOP” Scheme (One distt One Product) with focus to Increase Farm Productivity & allied Industries - like Milk & Dairy has Potential to Employ Millions of People. Textile is another area where Automation & digitization is required in big way for Businesses to remain Profitable & Competitive & banks should start giving loan to Young weavers & units that are already Operational. |