New Delhi, Mar 31 (KNN) In 2023-24 the growth of textile sector will be driven by domestic demand as export demand is expected to be limited due to a slowdown in key markets.

According to the Crisil SME trackers the textiles industry is set for moderation in revenue growth in FY24.

In FY23 a sharp rise in cotton yarn prices at the start of the year and moderation in export demand are expected to impact industry revenue and profitability.

The revenues of SMEs in the spinning segment, which are more susceptible to fluctuations in raw material prices, are set to contract 9-11 per cent, led by a decline in yarn prices later.

Due to high base and subdued export demand the cotton yarn prices are projected to fall almost 15 per cent in FY24 which is expected to hurt price realisation. 

In the readymade garment (RMG) segment, an easing of discretionary spending in leading consumer markets such as the US and EU will tone down revenue growth of key export-oriented RMG clusters such as Tirupur, Bengaluru and Mumbai to 6-8 per cent.

Clusters like Kolkata, Kanchipuram and Ludhiana are likely to outperform the export-centric clusters.

However, after a contraction in operating profit margins in FY23, players’ profitability is expected to improve due to easing of input cost pressure.  (KNN Bureau)