COIMBATORE: Garment exports are growing at a robust pace on the back of good demand in key overseas markets leading to a re-rating of the sector. India Ratings & Research expects the financial metrics of garment manufacturers to improve during 2013-14, which could be one of the key drivers for a positive ratings action.
"A combination of improving textile and apparel demand from large markets, benefits accruing from a depreciating rupee and structural changes in competing markets like China and Bangladesh have resulted in improved performance and stronger order book visibility for Indian exporters," said Tanu Sharma, associate director, corporates, India Ratings & Research. "The trends are seen to sustain in the short-to-medium term."
Most garment exporters are running on full capacity and are outsourcing manufacturing on a job work basis as orders are growing ahead of the peak festive season that falls in December, the agency said. Garment exports grew 13% year-on-year (y-o-y) in dollar terms to around $6.5 billion in April-September. The growth in rupee terms was even better at 18% on a y-o-y basis for the period.
Most garment exporters are running on full capacity and are outsourcing manufacturing on a job work basis as orders are growing ahead of the peak festive season that falls in December, the agency said. Garment exports grew 13% year-on-year (y-o-y) in dollar terms to around $6.5 billion in April-September. The growth in rupee terms was even better at 18% on a y-o-y basis for the period.
