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Unlike other verticals of textile industry, the home textiles vertical has taken a beating in the first quarter. According to industry players like GHCL and Pradip Overseas, while the margins have more or less remained intact, the revenue have fallen for the players.
While for GHCL, the revenue has fallen due to rationalisation in its clientele, for players like Jindal Worldwide and Pradip Overseas the same has fallen due to dip in demand.
"Apart from manufacturing, we also used to do trading in our business. However, we stopped doing so in home textiles. Plus, we also cut down on some dormant clients which were not earning us good margins. This is why our revenue for the first quarter came down in home textiles," said RS Jalan, managing director of GHCL, one of the leading home textiles player in the country. The company's revenue from textiles segment for the first quarter of fiscal 2013-14 stood at Rs 210.49 crore as against Rs 235.47 crore for the corresponding period last year.
Similarly, Ahmedabad-based Pradip Overseas Limited (POL) also saw its home textile revenue taking a hit for Q1 ended June 30, 2013 as against same period last year. The group is involved in diverse activities including manufacturing of curtain, quilts, comforters, towel, cushions, flannel, jersey, towels and other products.
As compared to Rs 180 crore revenue in home textiles for first quarter last fiscal, Pradip Overseas saw only a revenue of Rs 130 crore, said JS Negi, director - technical of the company.
"Our margins have also taken a hit. Demand has been pretty low in the first quarter for home textiles. We believe the second quarter will also continue to be the same due to heavy rains in monsoon. Add to that, we are currently running at only 50 per cent of our 250,000 metres per day capacity at our Ahmedabad plant," said Negi.
The home textiles major had launched its own brand of home furnishing titled 'MYCK' which the company markets through distributors to enterprise customer.
According to Vikram Oza, director - finance of Jindal Worldwide, a denim, fabric and home textiles player based out of Ahmedabad, home textiles has also taken a beating since it is not a necessity product.
"Home textile is not a necessity product and has therefore seen a decline in revenue and sales in the first quarter in the industry. It only picks up during the festival season. Exports too get a boost only in that time," said Oza.
The company saw its first quarter revenue from home textiles segment in the range of Rs 15 crore.
Industry players cite that the organised home textiles industry is valued at Rs 1,200 crore while the total market size including the unorganised segment is around Rs 3000 crore in the country.
