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Siyaram Silk Mills (SSML), reported good numbers on an operational basis in for Q2FY18. EBITDA margins expanded by 270 bps to 15.2 per cent, following lower raw material cost (down 592 bps y-o-y to 43.1 per cent of sales. Revenue was flat at Rs 423 crore, showing slow pick-up in consumer demand (following GST). Good operational performance and lower interest cost (down 23 per cent to Rs 7 crore) resulted in net profit growth of 19 per cent to Rs 31 crore.
As of Sept’17 SSML’s debt stood at Rs 435 crore. SSML has launched various brands from value for money (Siyaram’s, Mistair, Oxemberg, MSD) to premium brands (J Hampstead, Cadini, Zenesis, Moretti and Royale Linen).
SSML has been focusing on brand building exercise, which is expected to ensure high brand recall and help demand. Contribution of readymade garments business is expected to increase to 27 per cent in FY19E vs 21 per cent in FY17. Increasing focus on premium brands and high margin readymade garments segment is likely to bode well for the company.
Apparel exporters gained over others in during Q2 of this financial year. KPR Mill, Kitex Garments and Gokaldas Exports, where exports are the mainstay of their business, have seen revenue/profit improving or steady over both the June quarter (Q1), which was just before GST, as well as Q2. Raymond recorded profits of Rs 62 crore when compared to a net loss of Rs 7 crore in the pre-GST quarter of April-June. On the other hand, Page Industries and Arvind, whose garment business is equally focused on the domestic market, felt the impact of GST rollout of 28 per cent on branded apparel, with their Q2 bottom line declining over Q1 this year.
Analysts say there was slightly reduced domestic demand in the month post GST, despite a marginal rise in export. Wazir Advisors says sales for exporters had increased with a rise in capacities and utilisation of specific companies (KPR, Kitex and Gokaldas). KPR Mill saw its garment production increase year-on-year from 30.48 million units in Q2 last year to 39.41 million this year. As Prashant Agarwal, Joint MD, Wazir Advisors points out India’s apparel export to the US grew 6 per cent in Q2 from a year ago. However, for overall top textile players, consolidated sales fell by five per cent and EBITDA margins fell by an average of four per cent. Ebitda margin remained the same or fell for most companies. A rise in net profit of some, such as Raymond, Kitex and Gokaldas Exports, was largely due to higher other income. While KPR Mill posted growth in net profit from Rs 62.8 crore in Q2 last year to Rs 63.2 crore this time, Kitex Garments rose from Rs 13.1 crore to Rs 24.1 crore.
The recently concluded 19th edition of the Performance Days trade fair for functional fabrics and sport accessories has achieved new top ratings in all areas, say the organisers. “The halls of the MTC were filled to maximum capacity and recorded significantly more visitors than the previous fair last April and even more than the fair in November 2016,” they report.
Performance Days is the functional fabric fair for the sourcing of fabrics and accessories in functionnal sports, work- and corporate wear as well as sportive fashion. The number of trade visitors rose from 1,868 in November 2016, to 2,001 breaking the 2,000 mark for the first time. This growth records a 7.1 per cent increase as against the previous year, the number of exhibitors was also greater in autumn 2017, registering a 9.9 per cent increase.
A total 177 exhibitors from 23 countries filled all of the halls to capacity, confirming the decision to relocate to the halls of Messe München, which is scheduled for November 2018. “Even now, shortly after opening the exhibitor registration period, demand is already higher than the number of available spaces,” say organisers.
Next Performance Days to be held from November 28-29, 2018, will be celebrating its 10th anniversary. It will also be the first edition of Performance Days at the new location. In the future, one of the large halls on the exhibition grounds in Munich-Riem will be provided twice a year for functional fabrics.
For one last time at MTC Munich, there will be a ‘farewell event’ from April 18-19, 2018. All latest trends for Kick Off Sommer 2020 and Update Winter 2019/20, plus the Focus Topic in addition to the Performance Forum and the coveted awards will be presented. All the highlights and important information like the presentations, as well as all the fabrics at the Forum will be available online. Samples of all featured Performance Forum fabrics can also be ordered online.
LVMH, the world’s biggest luxury goods company, will do “a bit better” in 2018 than this year, the group’s managing director disclosed recently. In October, the group, which owns fashion brands such as Louis Vuitton, Christian Dior and Moet & Chandon champagne and Hennessy cognac - reported a higher-than-expected 12 per cent rise in like-for-like sales during Q3 of 2017. Revenues were £26.89 billion. “I think that in 2018 (LVMH) will do a bit better than in 2017,” disclosed Antonio Belloni on the side lines of the opening of the group’s first vocational training programme in Italy, in Florence.
Belloni said the group, which has invested €150 million in Italy this year, would “continue with this trend”, adding it had just bought a former furnace just outside Florence, close to where the group already produces high-end accessories for its brand Fendi.
Guess? Inc. has managed to rope in legendary models for years including Claudia Schiffer in 1992, Anna Nicole Smith in 1993, and Paris Hilton in 2004. Now the brand has managed to sign up superstar Jennifer Lopez to be the face of their Spring 2018 campaign. Lopez is thrilled and excited to be a part of such an iconic brand that she has loved since a teenager.
The campaign, art directed by Paul Marciano, was shot by fashion photographer Tatiana Gerusova. It draws inspiration from Lopez’s life as a performer in Las Vegas and a Hollywood actress. Shot in a villa, the images evoke classic Guess campaigns with influences of her aesthetic and personal style. Marciano points out, “Jennifer’s impact and influence continues to grow and this campaign celebrates the notion that women get more beautiful and talented as they gain life experience. Her beauty and class shine through this campaign."
Garment exporters expect 6 million jobs to be lost in the coming months if the situation continues. Textile is the largest employer after agriculture and pays Rs 26,000 crore in annual wages. They expect over 15 per cent decline in shipments this financial year to $14 billion on account of reduced incentive on duty drawback and rebate on certain state levies post the rollout of the goods and services tax (GST).
In October and as per exporters exports of readymade garments fell 41 per cent. Exporters expect 6 million jobs to be lost in the coming months if the situation continues. Textile is the largest employer after agriculture and pays Rs 26,000 crore in annual wages. Vinod Dhawan, President, Apparel Exporters and Manufacturers Association (AEMA) says that due to tardy implementation of GST, they are incurring higher expenditure on compliance and other transaction costs.
Various apparel export bodies also voiced concern on competition from Vietnam, Indonesia and Bangladesh and migration of customers to these countries besides the preferential tariff they get in international market. The impact of GST became visible from October and exporters and are seeing a 7 per cent on year decline in order books. Lalit Thukral, President, Noida Apparel Export Cluster stated it is extremely important that the government addresses the issues raised by the industry in order to stem the decline in exports.
Recently, under the Merchandise Export from India Scheme (MEIS) the government doubled the incentive for garments exporters and made it 4 per cent of value of exports from 2 per cent with effect from November 1, 2017, to June 30, 2018.
American Apparel chief executive Dov Charney new brand Los Angeles Apparel (LAA) kick-starts its retail operations. The brand opened its e-commerce site for direct-to-commerce visitors with an assortment of clean basics. The manufacturing of LAA is based in South-Western LA, the same ethics with which American Apparel was initially launched.
Right before Thanksgiving and just ahead of the black Friday rush, Charney announced LAA’s soft launch through his Facebook and Instagram accounts.
At the moment, the website hosts a line of T-shirts, sweatshirts, bodysuits and leggings with a price range of US $ 25 to US $ 60. The work on further expansion towards denim for women, a canvas bag collection, swimwear and a work wear line for men and women is underway.
Charney launched Los Angeles Apparel earlier this year and the brand looks incredibly similar to his former project.
The brand first cemented a deal with TSC Apparel, a top-tier T-shirt distributor that works with popular corporate and school merchandisers. Similar to American Apparel, where Charney was ousted amidst sexual harassment rumours and sluggish sales, Los Angeles Apparel (LAA) started out with wholesale circulation.
Charney earlier mentioned that both brick and mortar and online stores were on the cards for his new project. He had also stated that LAA will generate US $ 600 million in revenue over the next decade.
Bangladesh knitwear manufacturers are demanded easing of Brazil's visa rules so that more businessmen from Bangladesh can travel frequently to the Latin American country to explore business opportunities. AKM Salim Osman, President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), made the request while speaking at a meeting to discuss issues.
As per a BKMEA statement, the Brazilian Ambassador to Bangladesh, João Tabajara de Oliveira Júnior attended the meeting where Osman urged the envoy to help bilateral investment as Brazil is an important source for Bangladesh for raw cotton. He also proposed a joint venture investment by Bangladesh's knitwear entrepreneurs to import yarn from Brazil.
Regular interactions between Chambers of both countries can help establish warm business relations, the statement added. It may be noted that during the 2014 FIFA World Cup, Bangladesh supplied millions of pieces of jerseys to Brazil.
BIGTEX – Bangladesh Int’l Garment & Textile Machinery Expo 2017 will be held in Dhaka from November 30 to December 3 at the International Convention City Bashundhara. This is an international expo on Garment & Textile Machinery. China Textile Machinery Association, (organizer of ITMA + CITME) is the strategic partner of this expo. Garment and textile machinery, equipment, technology and accessories manufacturer, dealers, suppliers and importers will participate at this mega exhibition that is targeted at the entire textile, garment and apparel industry of Bangladesh.
Two more simultaneous exhibitions will take place: The Bangladesh Int’l Fabric & Yarn Expo 2017 and the Bangladesh Int’l Dyes, Pigments and Chemicals Expo 2017. The expo will have almost 180 stalls with products from 12 countries including Bangladesh, China, England, France etc. Bangladesh is the second largest apparel exporter in the world, is the top denim exporter to the EU and has become the world’s second largest knitwear exporter. Every third European wears a T-shirt made in Bangladesh and every fifth American wears jeans manufactured in Bangladesh. To ensure continued growth the industry needs proper machinery and regular supply of raw materials, yarn, fabric, dyes and chemicals.
Bangladesh now has set a goal of earning $60 billion from exports. To achieve this target they need to focus more on value added, high-end apparel items rather than basic, traditional products to make the business sustainable in fiercely competitive markets in the global garment trade.
Bangladesh’s apparel manufacturers are demanding implementation of a clear strategy in energy supply to its industry following fears of a hike in bulk power tariff. Manufacturers feel a need for holistic plan for energy supply as key area of concern for entrepreneurs to take planned investment decisions. The country has already raised the retail power tariff by BDT 0.35 per unit, to be effective from December 2017. The bulk tariff, used by industries, is not yet raised, prior to the hike, Bangladesh’s Power Development Board proposed raising the power tariff by 15 per cent per unit at the bulk level.
Currently, the bulk tariff per unit of electricity is BDT 4.90. The Power Development Board proposed that it should be set at BDT 5.99, however, a final decision is yet to be announced. Mohammed Nasir, Vice President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) points out energy is an absolute prerequisite to tap the potential of the industrial sector, especially the apparel industry. More development requires more energy. Therefore, the government must draw a clear strategy for supply.
