Sivaramakrishnan Ganapathi, MD, Gokaldas Exports believes that regarding apparel export, longer-term prospects continue to be very strong. Though it will be another couple of quarters before which the demand should start seeing an uptrend.
As per him, the longer-term prospects for this industry continue to be very strong. The movement away from China, particularly for US buyers, is very strong. It can be seen from data as well that the share of imports from China into US has continuously, consistently come down and that trajectory continues.
Most of the brands are looking at alternate sourcing and India figures high on the radar amongst the brands or the buyers. So, there is a great opportunity, plus Government of India working on FTAs, etc, can also help increase demand from this region.
Leading business daily Economic Times quoted him saying that “People will try to improve their margins because that trajectory will continue. But let me get onto the longer-term narrative because we often-times get caught up in short-term narrative saying that there is a demand headwind, etc, which is a fact. So, I would presume that all the effort that we are putting in is going to yield fruit in FY ’25 and beyond.”
He said that “There are indications for that at the moment and if that happens, I think it will help in overall demand and again margins are a function of all of these plus how efficiently you run your own operations.”
It can be mentioned that the raw material prices are soft as there is a softness in demand for end user garments as well in the global markets.
He also that “Gokaldas Exports is constantly working on adding customers so that is perpetual work in progress. These customers will ramp up through FY ’24 but a significant contribution from them will come in FY ’25. So, all of these relationships start small and then mature. So, I would presume that all the effort that we are putting in is going to yield fruit in FY ’25 and beyond.”
