Tell about Textiles Companies ?

India's logistic disadvantage due to its geographical location can give it a major thumbs-down in global trade

The country is distant from major is markets as compared to its global competitors like Mexico, Turkey and China, which are located in relatively close vicinity to major global markets of US, Europe and Japan.

Companies that have achieved integration between the various links in the supply chain through their global subsidiaries stand to gain in this regard hmm...

With foreign brands being allowed to make a foray into to India through the FDI route (FDI in single brand retailing) it calls for competitiveness on the part of the Indian players.....

Be it through the joint venture route or otherwise, companies that have so far been taking the advantage of in-licensing the established brands now need to focus on building their own.

Earnings of the textile sector have been very volatile in the past due to reasons like change in raw material prices (wool and cotton), slower demand growth, foreign exchange sensitivity and competition

The scenario is likely to remain the same in the future as well, despite growth opportunities in international markets.

Since textile is a mature industry, companies in the sector are valued on the basis of their price to forward earnings multiple (P/E). Having said that, investors should also accord some premium in valuing companies that have differentiated themselves on the following parameters.

Focus on higher value addition and thrust on enriching product mix is India's attempt to differentiate itself from regional peers such as China and Pakistan.

India's higher price realisations have reasonably compensated for the relatively lower market share of exports to the US as compared to China.

Further, once the higher capacities get commissioned, we believe that the Indian companies (into value added products) would be in a position to garner better margins and healthier profitability in the future.

Most companies in the sector timed their expansion plans FY04 onwards, so as to avail themselves of the funding under TUF (earlier due expiry in March 2007).

This led to the capex-spending phase in the textile sector peaking in the last two fiscals.

Against this backdrop, we believe that a majority of the capex in the sector has already been incurred or is in the last leg of completion, the benefits of which should start filtering in from FY08 onwards, once the new capacities stabilise and the utilisation levels get normalised

Nonetheless, with the TUF duration getting elongated and proposed investments set to be completed by FY10, the capex benefits are yet to become visible.

Several Indian textile companies have formed alliances with their global counterparts, particularly those with strong front-end capabilities, in a bid to access global markets, tap technological know-how, design skills and branding and retailing ability.

The alliances have been struck in most cases by way of JVs or stake acquisition.

Most large textile companies in India, realising the growth potential in domestic retailing, have drawn up aggressive strategies to expand their footprint in the domestic market.

These include companies like Welspun and Himatsingka, which were traditionally export-oriented, as also Raymond, which has been the pioneer in domestic textile retailing. Home textile (furnishing) companies like Himatsingka and Welspun have also taken steps in this direction with their outlets 'Atmosphere' and 'Spaces' respectively.

While strong business prospects, valuations and peer comparison do serve the purpose of identifying a textile stock, the investment argument must be backed by a strong track record of the management, its vision and its integrity. The same especially holds true in case of the textile sector where the management is responsible for the survival of the company in times of downturn and enhancement of the shareholders' return in good times.

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Your strategy for investing in 2019 and beyond. Relish the volatility but keep your focus on the fundamentals and buy these 4 stocks.

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For the quarter ended September 2018, ALOK INDUSTRIES has posted a net profit of Rs 14 bn (up 75.2% YoY). Sales on the other hand came in at Rs 9 bn (up 12.8% YoY). Read on for a complete analysis of ALOK INDUSTRIES's quarterly results.