Around 40 textile and apparel companies in Tamil Nadu are keen to explore the initial public offer (IPO) option to list their shares in Indian equity markets.
The combined market cap of listed companies from Indian textile and apparel sector is only at 2.2 lakh crore,while Indian equity markets’ market capitalisation crossed Rs. 240 lakh crore.
At the same time, Indian capital markets are growing at rapid pace and textile sector is also garnering lot of interest and attention from investors with valuations rallying upwards.
Indian Texpreneurs Federation (ITF), Coimbatore,conducted a survey of 257 members companies with the combined yearly sales turnover of Rs 36,000 crore.There was participation from manufacturing units across the value chain, which included spinning, semi-integrated, integrated, weaving, apparel, processing and home textiles.
Notably, 16 per cent of companies in this survey said that they are keen for IPO.
Besides, 30 per cent of the entrepreneurs mentioned that they are confident of doubling their current sales in 3 years’ time with a 25 per cent CAGR, while 18 per cent mentioned that they will double their current sales in 4 years with a 20 per cent CAGR.
36per cent of the entrepreneurs mentioned of achieving the target of doubling yarn sales in 5 years’ time with 15per cent CAGR.
The survey also highlighted that Tamil Nadu’s textile and apparel industry bets on growth with a focus on value addition.
ITF, a leading trade body of the state, did this survey to understand the growth aspirations of Tamil Nadu textile and apparel sector in line with the positive trend prevailing in exports market in the post-Covid global business environment.
Prabhu Dhamodharan, Convenor, ITF, Coimbatore informed that in total, 76per cent of the surveyed firms mentioned about doubling the current site of business in 3 to 5 years with new capex cycle.
Within the sub segments of textile manufacturing, home textiles, weaving andapparel segments are showing better momentum in terms of growth. This trend will help Tamil Nadu textile sector to further strengthen the value-added product manufacturing.
The survey also says that 58per cent of the entrepreneurs mentioned about the keen willingness of next generation in taking forward the business.
“China plus One opportunity in exports market for Indian players, structural reforms from Union Government, renewed and new thrust from the State Government to support manufacturing sector, funding availability with lower Interest rates, new attention from international buyers towards Tamil Nadu textile eco-system due to its inherent strengths are the major reasons for such growth aspirations,” says Prabhu.
In a statement, he said that associations like ITF need to create new platforms to bring new trends and dynamism with a collaborative approach to match the aspirations and thoughts of the younger generation to motivate the less interested faction also towards new business opportunities.
By realizing these facts, the companies in Tamil Nadu’s textile sector are now keen to explore opportunity, which is a welcome trend.
