A new report by India Ratings says, man-made fibers and yarn segments are expected to recover due to pent-up demand and strong export order build up in all the segments. The report states, both segments will benefit from the low raw material prices in the third quarter this financial year. Their volumes have improved to 50-80 per cent of normal levels in August, led by pent-up demand and strong export order build up in all the segments. However, plant utilization of pure man-made fibers and yarn manufacturers was severely impacted due to the lockdown.
Ind-Ra expects raw material prices to remain moderate in the second half of FY21. It expects fabric and apparel prices to decline in August, led by a quick supply restoration than demand recovery. It expects demand for home textile exports to sustain in 2HFY21 at healthy levels achieved over August-September. According to Ind-Ra, Indian players are likely to increase their already strong market share in terry towels and bed linens, led by supply chain diversification away from China.