wazir textile index textile index report - h1 fy19...5 wazir textile index (wti) –h1 fy19 sales is...
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Wazir Textile IndexHalf Yearly Report: H1 FY 2018-19
December 2018
2
• Wazir Textile Index – H1 FY19
• Half Yearly Financial Performance – H1 FY19
• Market Update
• Key Economic Indicators
• Export – Import Trend
• Raw Material Price Trend
• Annexure: Wazir Textile Index – Explanation
Contents
Wazir Textile Index (WTI) – H1 FY19
4
S. No. Company Name Annual Sales* - FY18 (Rs Cr)
1 Arvind 6,420
2 Vardhman 5,851
3 Welspun India 4,977
4 SRF 4,582
5 Trident 4,564
6 Raymond 3,012
7 RSWM 2,940
8 KPR Mills 2,512
9 Sutlej Industries 2,462
10 Indo Rama Synthetics 2,256
List of Companies included as part of financial analysis
Top listed textile companies in terms of sales turnover in FY18 have been included for financial analysis
Note: Companies that have shown significant negative deviation in numbers or those which have not yet reported the financials have not been included in the overall analysis
Source: Moneycontrol * Sales constitutes total operating income, standalone financials have been considered for analysis
5
Wazir Textile Index (WTI) – H1 FY19
Sales is increasing and there is revival in EBITDA margins
WTI Sales WTI EBITDA
100109.9 110.3 121.1
Base year(H1 FY16)
H1 FY17 H1 FY18 H1 FY19
100109.1
80.9
96.3
Base year(H1 FY16)
H1 FY17 H1 FY18 H1 FY19
100 100 100 109.6 119.3107.4117.8
128.9109.0
126.8 135.2 125.1
RM Cost Employee Cost Other Cost
WTI Cost
Base year (H1 FY16) H1 FY17 H1 FY18 H1 FY19
• In H1 FY19, overall sales and EBITDA increased significantly by 10% and 19% respectively.• Raw material and employee costs have continued to increase during first half of FY19.
Half Yearly Financial Performance –
H1 FY19
7
Overall Revenue and EBITDA margin witnessed growth in H1 FY19
3,106 2,883 2,5692,323
2,077
1,392 1,389 1,211 1,256 1,172
3,294 3,1362,819
2,5233,030
1,4511,518
750
1,303 1,450
Arvind Vardhman WelspunIndia
Trident SRF RSWM Raymond Indo Rama SutlejIndustries
KPR Mills
Half Yearly Sales* Trend – H1 FY19 (Rs Cr.)
6% 9%10%9% 46% 4% 9% -38% 4% 24%
10%14%
17% 17% 17%
7% 5% 3%
11%18%
10%
18% 15% 18% 17%
8% 6% 0.5%9%
20%
Arvind Vardhman WelspunIndia
Trident SRF RSWM Raymond Indo Rama SutlejIndustries
KPR Mills
Half Yearly EBITDA Margin Trend – H1 FY19
HY1-FY18 HY1-FY19
• Sales of top companies (except Indo Rama) have grown in first half of FY 2018-19.• SRF has shown the highest sales growth of 46% in H1 FY19, while Indo Rama Synthetics witnessed
the highest decline, falling 38% over the same period.• Except Welspun, Sutlej Textiles and Indo Rama Synthetics, EBITDA margins of all other top companies
have increased or remained stagnant in H1 FY19.
Source: Moneycontrol * Sales and EBITDA are as per operating performance of companies
8
Half yearly Analysis - Major expenses as % of sales
45% 54% 51% 50% 54% 57% 45%75%
56% 63%46% 51% 53% 46% 56% 56% 46%
76%58% 58%
Arvind Vardhman WelspunIndia
Trident SRF RSWM Raymond Indo Rama SutlejIndustries
KPR Mills
Raw Material Cost – % of sales
13%8% 10% 12%
9%14% 15%
4%
12% 10%12%8% 9%
12%7%
12%15%
5%
12% 12%
Arvind Vardhman WelspunIndia
Trident SRF RSWM Raymond Indo Rama SutlejIndustries
KPR Mills
Employee Cost – % of sales
32% 23% 22% 20% 20% 23%35%
18% 20%10%
32%23% 23% 24% 20% 23%
34%18% 21%
11%
Arvind Vardhman WelspunIndia
Trident SRF RSWM Raymond Indo Rama SutlejIndustries
KPR Mills
Other Costs – % of sales
HY1-FY18 HY1-FY19
Source: Moneycontrol
9
Consolidated analysis for the selected top players
19,378
21,272
H1 FY18 H1 FY19
Consolidated Sales – Rs. Cr On consolidated level, Sales have increased by 10% in H1 FY19 as
compared to H1 FY18
Consolidated EBITDA margin increased by 1.1 percentage points for the selected top
companies
12.7%
13.8%
H1 FY18 H1 FY19
Average EBITDA %
Average RM cost declined marginally as
compared to first half of previous year
Average employee cost also declined
marginally
Other expenses increased by 1 p.p.
53.3%
52.3%
H1 FY18 H1 FY19
Average RM Cost - % of Sales
10.7%
10.2%
H1 FY18 H1 FY19
Average Employee Cost -% of Sales
Source: Moneycontrol * Percentage Points
10% 1.1 pp*
22.7%
23.7%
H1 FY18 H1 FY19
Average Other Expenses -% of Sales
Market Update
11
Key Economic Indicators
Average IIP for textiles and apparel increased by 2%
and 5% respectively in H1 FY19 compared to H1
FY18
100
110
120
May
'15
July
'15
Sep
'15
No
v'15
Jan
'16
Mar
'16
May
'16
July
'16
Sep
'16
No
v'16
Jan
'17
Mar
'17
May
'17
July
'17
Sep
'17
No
v'17
Jan
'18
Mar
'18
May
'18
July
'18
Sep
'18
Wholesale price index (WPI*)
Textiles
Average WPI for textiles increased by 3% in H1
FY19 compared to H1 FY18
India’s real GDP has grown by 7.1% in H1 FY19
compared to H1 FY18
7.1% Growth
100.0
120.0
140.0
160.0
180.0
200.0
July
'15
Sep
'15
No
v'1
5
Jan
'16
Mar
'16
May
'16
July
'16
Sep
'16
No
v'1
6
Jan
'17
Mar
'17
May
'17
July
'17
Sep
'17
No
v'1
7
Jan
'18
Mar
'18
May
'18
July
'18
Sep
'18
Index of Industrial Production (IIP*)
Textiles Apparel
Rs. Lakh Cr.
Source: Reserve Bank of India, Economic Advisor, Govt. of India *Base Year 2011-12
62.91
67.72
H1 FY18 H1 FY19
India’s GDP (at constant prices)
12
India’s overall T&A* exports have declined by 1% in H1 FY19, Apparel exports declined heavily by 16%
However, Fibre, Filament and Yarn exports witnessed double digit growth
India’s Textile and Apparel Exports (In US$ mn.)
• Export of all the categories except apparel have grown in H1 FY19 as compared to H1 FY18. OverallT&A exports declined by 1% in first half of FY 2018-19.
• Apparel exports saw a decline of 16% this half year. Decline in apparel exports is largely attributedto declining exports to UAE, which have declined sharply by 55% during H1 FY19. Overall T&Aexports to UAE declined by ~50% during this half year.
• EU, USA and UAE remains the top export destinations for India’s T&A products.
Source: DGCI&S *T&A – Textile & Apparel
25%
22%
7%6%
6%
34%
EU-28 USA UAE
Bangladesh China Others
26%
21%
13%5%3%
32%
India’s Top T&A Export Markets
% Value Share
H1 FY18
H1 FY19Category Q1
FY18Q1
FY19%
Change
Q2 FY18
Q2 FY19
% Change
H1 FY18 H1 FY19 %chan
ge
Fibre 632 854 35% 372 540 45% 1,004 1,393 39%
Filament 270 352 30% 310 335 8% 580 686 18%
Yarn 879 1,297 48% 1,007 1,241 23% 1,886 2,538 35%
Fabric 1,148 1,145 -0.3% 1,169 1,182 1% 2,318 2,326 0.4%
Apparel 4,906 4,050 -17% 4,277 3,673 -14% 9,184 7,723 -16%
Home Textile
1,280 1,294 1% 1,381 1,438 4% 2,660 2,731 3%
Others 438 491 12% 518 527 2% 956 1,018 7%
Total 9,553 9,481 -1% 9,035 8,935 -1% 18,588 18,417 -1%
13
India’s T&A* imports have increased by 4% in H1 FY19.
India’s Textile and Apparel Imports (In US$ mn.)
• Import of all categories except Fibre have increased in H1 FY19.• Apparel imports increased heavily by 56%, primarily due to impact of reduced effective import
duties post GST for imports from countries like Bangladesh & China.• China continues to be the largest import partner for India, however imports from china declined
marginally by 0.4% when compared y-o-y.
Source: DGCI&S *T&A – Textile & Apparel
37%
10%9%
7%
4%
33%
China EU-28USA BangladeshAustralia Others
39%
8%12%
4%6%
30%
India’s Top T&A Import Markets
% Value Share
H1 FY18
H1 FY19
Apparel imports increased significantly by 56% in H1 FY19
Category Q1 FY18
Q1FY19
% Chan
ge
Q2 FY18
Q2 FY19
% Chan
ge
H1FY18
H1FY19
%chang
e
Fibre 583 502 -14% 670 467 -30% 1,254 969 -23%
Filament 156 167 7% 159 182 15% 315 349 11%
Yarn 101 114 14% 105 103 -2% 205 217 6%
Fabric 603 661 10% 544 614 13% 1,148 1,275 11%
Apparel 140 196 40% 208 346 66% 347 541 56%
Home Textiles
59 58 -2% 85 90 6% 144 148 3%
Others 139 171 23% 144 171 19% 283 342 21%
Total 1,781 1,869 5% 1,915 1,972 3% 3,696 3,841 4%
14
T&A imports of USA increased in H1 FY19 while that of EU declined marginally
130
218.9 7.9 4.4 2.9 2.1 2.0 1.6 1.2 0.6
129
22
10 8.6 4.7 3.2 2.5 2.2 1.8 1.3 1.1
World China Bangladesh Turkey India Pakistan Cambodia Vietnam Morocco Tunisia Myanmar
H1 FY18 H1 FY19
15%4.5% 6.2%9.2%
Overall Imports and Top import Countries of EU-28*
8.9%16% 11% 13% 12% 69%
-0.6%
in US$ Bn
56
21
6.3 3.7 2.7 2.4
2.4 1.4 1.3
1.1
58
21
6.8 3.9 2.9
2.4 2.4 1.4 1.4
1.3 1.0
World China Vietnam India Bangladesh Mexico Indonesia Pakistan Honduras Cambodia El Salvador
H1 FY18 H1 FY19
7.3%
1.1%
9.1%5.2%
Overall Imports and Top import Countries of USA
0.5% 0.1% 3.5% 0.4% 15% 3.3%
4% in US$ Bn
Source: OTEXA, EUROSTAT * EU-28 data excludes intra EU trade
15
Average raw material prices increased in H1 FY19 compared to H1 FY18
150160170180190200210220230240250
May
'15
July
'15
Sep
'15
No
v'15
Jan
'16
Mar
'16
May
'16
July
'16
Sep
'16
No
v'16
Jan
'17
Mar
'17
May
'17
July
'17
Sep
'17
No
v'17
Jan
'18
Mar
'18
May
'18
July
'18
Sep
'18
Yarn Prices Rs./Kg
Cotton Yarn PV Yarn PC Yarn
Average price change in H1 FY19 as compared to H1 FY18• 6% increase in cotton
yarn • 7% increase in PV yarn• 9% increase in PC yarn
6080
100120140160180200220
May
'15
July
'15
Sep
'15
No
v'15
Jan
'16
Mar
'16
May
'16
July
'16
Sep
'16
No
v'16
Jan
'17
Mar
'17
May
'17
July
'17
Sep
'17
No
v'17
Jan
'18
Mar
'18
May
'18
July
'18
Sep
'18
Fibre Prices Rs./Kg
Raw Cotton VSF PSF
Average price change inH1 FY19 as compared toH1 FY18• 8% increase in raw
cotton• 6% increase in VSF• 26% increase in PSF
Source: Ministry of Textiles
Annexure:
Wazir Textile Index (WTI) - Explanation
17
• Wazir Textile Index has been developed for assessing the overall financial performance of the textile sector on a continuous basis.
• This index takes the collective performance of top ten textile companies (by sales) of 2015-16 as the base/benchmark which is represented by the base Index number 100.
• Base value of 100 is assigned separately to each quarter performance and full year performance in 2015-16, and correspondingly financial performance of the textile industry is benchmarked to this base number to assess quarterly (Q1), half yearly (H1), nine monthly (9M) and yearly performance (FY) for subsequent years against the set benchmark.
• Overall textile index includes the following three components:
• WTI Sales : Consolidated sales index of top ten companies
• WTI EBITDA : Consolidated EBITDA index
• WTI Cost : Consolidated index for cost of Raw material, employee & others
Measuring financial performance of Indian Textile Sector
18
• EBITDA – Earnings Before Interest Tax Depreciation & Amortization
• EU – European Union
• FY – Financial Year
• FY16– April 2015 to March 2016
• FY17– April 2016 to March 2017
• FY18 – April 2017 to March 2018
• FY19– April 2018 to March 2019
• GDP – Gross Domestic Product
• H1 FY16– April 2015 to September 2015
• H1 FY17 – April 2016 to September 2016
• H1 FY18 – April 2017 to September 2017
• H1 FY19 – April 2018 to September 2018
• HK – Hong Kong
• PV – Polyester Viscose
• PC – Polyester Cotton
• PSF – Polyester Staple Fibre
• RM – Raw Material
• T&A – Textile & Apparel
• USA – United States of America
• UK – United Kingdom
• VSF – Viscose Staple Fibre
• WTI – Wazir Textile Index
• YOY – Year on Year
• YTD – Year till date
Glossary
CONTACT
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Prashant Agarwal
[email protected]+91 9871195008
Sanjay Arora
[email protected]+91 9971110566
Varun Vaid
[email protected]+91 9899985979
B.Prakash
[email protected]+91 9810866927
Website: www.wazir.in
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