The Indian textile and apparel sector, a significant contributor to the country's economy, recorded mixed performance in the first half of the fiscal year 2025 (H1 FY25). While certain segments exhibited robust growth, others faced challenges that impacted overall profitability.

Key performance indicators, as reflected by the Wazir Textile and Apparel indices, highlight the sector's positive trajectory.

Wazir Textile Index: A strong performance

The Wazir Textile Index, which tracks the performance of leading textile companies, recorded significant growth in H1 FY25 compared to the same period in the previous year. Key highlights include:

Sales surge: The sales index increased by 13 per cent, indicating robust demand for textile products both domestically and internationally.

Profit boost: The EBITDA index witnessed an impressive 43 per cent increase, signaling improved operational efficiency and cost management.

Consolidated growth: Consolidated sales of selected top textile companies grew by 8 per cent, while consolidated EBITDA improved by 1 percentage point.

The Wazir Apparel Index, which monitors the performance of leading apparel companies, also showed positive trends in H1 FY25. The sales index grew by 25 per cent, reflecting strong consumer demand for apparel products. The EBITDA index increased by 17 per cent%, indicating improved profitability despite rising input costs. Consolidated sales of selected top apparel companies grew by 25 per cent, while consolidated EBITDA remained relatively stable.

Considering the performance of all listed textile and apparel companies, the sector as a whole demonstrated solid growth in H1 FY25. Consolidated sales for all listed companies increased by 8 per cent compared to the same period last year. However, consolidated EBITDA declined by 1 per cent due to factors such as rising input costs and competitive pressures.

The positive performance of the textile and apparel sector in H1 FY25 was due to strong domestic demand. Robust domestic consumption, rising disposable incomes and changing consumer preferences, drove growth. Increasing global demand for Indian textiles and apparel, particularly in key markets like the US and Europe, too boosted export revenues. And government support, including schemes like the Production Linked Incentive (PLI) scheme, provided a significant boost to the sector. To add to it adoption of advanced technologies in manufacturing and supply chain management improved efficiency and reduced costs.

Outlook for the future

While the short-term outlook for the textile and apparel sector remains positive, certain challenges such as rising input costs, global economic uncertainties, and geopolitical tensions could impact future growth. However, the long-term growth prospects for the sector remain strong, driven by increasing domestic consumption, favorable government policies, and the potential for further export market penetration.

As the sector continues to evolve, companies that focus on innovation, sustainability, and brand building are likely to emerge as leaders. By adapting to changing consumer preferences and leveraging emerging technologies, the Indian textile and apparel industry can solidify its position as a global manufacturing and export hub.