Pursuant to the Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, your Directors have pleasure in presenting the Management and Analysis
Report for the year ended on March, 31st 2023.
An Overview Indian Textile Industry
India is the worlds second-largest producer of textiles and garments. It is also the
fifth-largest exporter of textiles spanning apparel, home and technical products. The
fundamental strength of the textile industry in India is its strong production base of a
wide range of fibre/yarns from natural fibres like cotton, jute, silk and wool to
synthetic/man-made fibres like polyester, viscose, nylon and acrylic.
The textiles and apparel industry contribute 2.3% to the countrys GDP, 13% to
industrial production and 12% to exports. Around 45 million people are working in the
textile business, including 3.5 million people who work on handlooms. The Indian textile
and apparel industry is expected to grow at 10% CAGR from 2019-20 to reach US$ 190 billion
by 2025-26. The Indian apparel market stood at US$ 40 billion in 2020 and is expected to
reach US$ 135 billion by 2025.
India enjoys a comparative advantage in terms of skilled manpower and in cost of
production relative to other major textile producers. Indias textile and apparel exports
(including handicrafts) stood at US$ 45.4 billion in FY23, a 41% increase YoY Exports of
readymade garments including cotton accessories stood at US$ 7.19 billion in FY23.
The textiles industry (including dyed and printed) attracted Foreign Direct Investment
(FDI) worth US$ 3.99 billion from April 2000-March 2022. 100% FDI (automatic route) is
allowed in the Indian textile sector.
The Governments Rs. 10,683 crore (US$ 1.44 billion) PLI scheme is expected to be a
major booster for the textile manufacturers. The scheme proposes to incentivise MMF
(man-made fibre) apparel, MMF fabrics and 10 segments of technical textiles products.
The Government approved the Mega Integrated Textile Region and Apparel (MITRA) Park
scheme worth Rs. 4,445 crore (US$ 594.26 million) to establish seven integrated mega
textile parks with state-of-the-art infrastructure, common utilities and R&D lab over
a three-year period, which will boost textile manufacturing in the country.
The industry is extremely varied, with hand-spun and hand-woven textiles sectors at one
end of the spectrum, with the capital-intensive sophisticated mills sector on the other
end. The decentralized power looms/ hosiery and knitting sector forms the largest
component in the textiles sector. The close linkage of textiles industry to agriculture
(for raw materials such as cotton) and the ancient culture and traditions of the country
in terms of textiles makes it unique in comparison to other industries in the country.
Indias textiles industry has a capacity to produce a wide variety of products suitable
for different market segments, both within India and across the world.
Market Size
Indias textiles industry has around 4.5 crore employed workers including 35.22 lakh
handloom workers across the country. Exports of textiles (RMG of all textiles, cotton
yarns/fabs/made-ups/handloom products, man-made yarns/fabs/made-ups, handicrafts excluding
handmade carpets, carpets and jute mfg. including floor coverings) stood at US$ 29.8
billion between April-December 2021.
The Indian textile and apparel industry is expected to grow at 10% CAGR from 2019-20 to
reach US$ 190 billion by 2025-26. India has a 4% share of the global trade in textiles and
apparel.
Cotton production in India is projected to reach 7.2 million tonnes (~43 million bales
of 170 kg each) by 2030, driven by increasing demand from consumers. In FY23, exports of
readymade garments (RMG) cotton including accessories stood at US$ 7.68 billion till
January 2023. It is expected to surpass US$ 30 billion by 2027, with an estimated 4.6-4.9%
share globally.
The Indian textiles market is expected to be worth more than US$ 209 billion by 2029.
India is the worlds largest producer of cotton. Estimated production stood at 362.18
lakh bales during cotton season 2021-22. Domestic consumption for the 2021-22 cotton
season is estimated to be at 338 lakh bales.
Production of fibre in India reached 2.40 MT in FY21 (till January 2021), while that
for yarn, the production stood at 4,762 million kgs during same period.
Indias textile and apparel exports (including handicrafts) stood at US$ 44.4 billion
in FY22, a 41% increase YoY During April-October in FY23, the total exports of textiles
stood at US$ 21.15 billion. Indias textile and apparel exports to the US, its single
largest market, stood at 27% of the total export value in FY22. Exports of readymade
garments including cotton accessories stood at US$ 6.19 billion in FY22.
INVESTMENT AND KEY DEVELOPMENT
The industry (including dyed and printed) attracted foreign direct investment (FDI)
worth US$ 4.067 billion from April 2000-December 2022. The textiles sector has witnessed a
spurt in investment during the last five years.
• In April 2022, Indo Count Industries bagged the home textile business of GHCL
for US$ 74.14 million.
• In March 2022, Reliance Retail Ventures Limited (RRVL) acquired a controlling
share of Purple Panda Fashions for US$ 115.8 million.
• Sutlej Textiles plans to set up a green field project for 89,184 spindles
comprising of cotton melange yarn and PC grey yarn along with dye house in Jammu &
Kashmir with an estimated cost of US$ 111.41 million (Rs. 914 crore).
• Vardhman has established Vardhman ReNova, a cotton recycling facility with a six
TPD production capacity. By establishing two new facilities in Madhya Pradesh, the company
has also increased its capacity to produce yarn. With top-notch technology, the expansion
includes over 100,000 spindles in total. This will result in a 75 TPD increase in yarn
production capacity.
• The textile ministry has selected 61 companies, including Arvind Limited to
enjoy benefits under its US$ 1.3 billion (Rs. 10,683 crore) production-linked incentive
(PLI) scheme for the labour-intensive textiles and garment sector. The companies have
pledged to invest US$ 2.32 billion (Rs 19,077) crore over five years under the scheme,
which will lead to an incremental turnover of US$ 22.55 billion (Rs 1.85 trillion) and
direct employment generation for 240,000 people.
• Arvind Limited, the largest textile to technology conglomerate in India, and
PurFi Global LLC, a sustainable technology firm that specialises in rejuvenating textile
waste into virgin grade products, have formed a joint venture to reduce the quantity of
textile waste dumped in landfills.
• In November 2022, local weavers in Tuensang in Nagaland were provided 45 days of
skill-upgrading training, which would equal 315 hours under the SAMARTH programme.
• In 2022-23, the Sardar Vallabhbhai Patel International School of Textiles and
Management (SVPISTM) is planning to offer B.Sc. and MBA courses in technical textiles.
• In November 2021, Federico Salas, the Mexican Ambassador to India, visited the
Khadi India Pavilion at the India International Trade Fair 2021 and suggested that India
and Mexico should come together to promote Khadi globally.
• Companies in home textile are using technology to optimise the value chain. For
example, in October 2021, Welspun India introduced Wel- Trak 2.0—an upgraded,
patented end-to-end traceability technology—to track textile raw materials throughout
the supply chain.
• Home textile companies in India are also leveraging strategic partnerships to
strengthen their business operations and foothold in the country.
• In October 2021, Welspun India collaborated with DuPont Biomaterials to
introduce a home textile range and strengthen the companys sustainable textiles business.
• In May 2021, Indo Count Industries Ltd. (ICIL) announced an investment of Rs.
200 crore (US$ 26.9 million) to expand its production capacity.
• In April 2021, RSWM Limited, flagship company of the US$ 1.2 billion LNJ
Bhilwara Group, was recognised for achieving the highest textile export turnover in 2020
by the Ministry of Industries & CSR, Government of Rajasthan.
• In April 2021, Bella Casa Fashion & Retail Ltd. (BCFRL) announced that it is
expanding its two existing plants and adding one new facility to offer employment
opportunities to 1,000 people. The expansion would involve a total investment of Rs. 65
crore (US$ 8.63 million).
Government Initiatives
The Indian government has come up with several export promotion policies for the
textiles sector. It has also allowed 100% FDI in the sector under the automatic route.
Other initiatives taken by the Government of India are:
• In February 2023, according to the Union Budget 2023-24, the total allocation
for the textile sector was Rs. 4,389.24 crore (US$ 536.4 million). Out of this, Rs. 900
crore (US$ 109.99 million) is for Amended Technology Upgradation Fund Scheme (ATUFS), Rs.
450 crore (US$ 54.99 million) for National Technical Textiles Mission, and Rs. 60 crore
(US$ 7.33 million) for Integrated Processing Development Scheme.
• In February 2023, the union government approved 1,000 acres for setting up a
textile park in Lucknow.
• In February 2023, according to the Union Budget 2023-24, the total allocation
for the textile sector was Rs. 4,389.24 crore (US$ 536.4 million). Out of this, Rs. 900
crore (US$ 109.99 million) is for Amended Technology Upgradation Fund Scheme (ATUFS), Rs.
450 crore (US$ 54.99 million) for National Technical Textiles Mission, and Rs. 60 crore
(US$ 7.33 million) for Integrated Processing Development Scheme.
• In December 2022, a total of 44 R&D projects were started, and 23 of them
were successfully completed. 9777 people were trained in a variety of activities relating
to the silk industry.
• In December 2022, a total of US$ 75.74 million (Rs. 621.41 crore) in subsidies
was distributed in 3,159 cases under the Amended Technology Upgradation Fund Scheme, with
special campaigns held in significant clusters to settle backlog cases.
• In December 2022, a total of 73,919 people (SC: 18,194, ST: 8,877, and Women:
64,352) have received training, out of which 38,823 have received placement under SAMARTH.
• The establishment of 7 (seven) PM Mega Integrated Textile Region and Apparel (PM
MITRA) Parks with a total investment of US$ 541.82 million (Rs. 4,445 crore) for the years
up to 2027-28 was approved by the government.
• In the academic year 2022-23, the opening of a new campus of the National
Institute of Fashion Technology (NIFT) in Daman. Moreover, new campus buildings are being
constructed in Bhopal and Srinagar.
• Under the National Technical Textile Mission (NTTM), 74 research projects for
speciality fibre and technical textiles valued at US$ 28.27 million (Rs. 232 crore) were
approved. 31 new HSN codes have been developed in this space.
• In November 2022, Tamil Nadu Chief Minister Mr. M. K. Stalin announced the
establishment of a "Textile City" in Chennai as part of Tamil Nadus strategy to
become a major participant in the global textile industry. Additionally, the state will
build a 1,500-acre textile park in the Virudhunagar district, for which SIPCOT will buy
land.
• In June 2022, Minister of Textiles, Commerce and Industry, Consumer Affairs
& Food and Public Distribution, Mr. Piyush Goyal, stated that the Indian government
wants to establish 75 textile hubs, similar to Tiruppur, which will greatly increase
employment opportunities while promoting the export of textile products and ensuring the
use of sustainable technology.
• In June 2022, Amazon India signed a MoU with the Manipur Handloom &
Handicrafts Development Corporation Limited (MHHDCL), a Government of Manipur entity, to
encourage the development of weavers and artisans throughout the state.
• In June 2022, the Kerala government announced that it would provide free
training to 1,975 candidates under the SAMARTH scheme of the textile industry.
• The Sustainable Textiles for Sustainable Development (SusTex) project by the
United Nations Climate Change entity enhances the employment and working circumstances of
textile artisans while promoting the sustainable production and use of environmentally
friendly textiles.
• In May 2022, Minister of Micro, Small and Medium Enterprises, Mr. Narayan Rane,
inaugurated the Center of Excellence for Khadi (CoEK) at NIFT, Delhi. In order to produce
innovative fabrics and apparel that will meet the needs of both domestic and foreign
consumers, the CoEK will seek to introduce the newest designs and adopt procedures that
adhere to international standards.
• In April 2022, Minister of Commerce and Industry, Consumer Affairs, Food and
Public Distribution and Textiles, Mr. Piyush Goyal, said that new Economic Cooperation and
Trade Agreements with Australia and the UAE would open infinite opportunities for textiles
and handloom. Indian textile exports to Australia and the UAE would now face zero duties,
and he expressed confidence that soon Europe, Canada, the UK and GCC countries would also
welcome Indian textile exports at zero duty.
• In March 2022, the Tamil Nadu government included a Sustainable Cotton
Cultivation Mission in its agriculture budget by allocating US$ 1.86 million (Rs 15.32
crore) to enhance the yield of organic cotton.
• In March 2022, the Ministry of Textiles, in collaboration with the Confederation
of Indian Industries (CII), organized a day-long International Conference on Technical
Textiles with the theme: Creating the Winning Leap in Technical Textiles.
• The Khadi and Village Industries Commission (KVIC) achieved turnover of Rs. 1.15
lakh crore (US$ 14.68 billion) in FY22, a growth of 20.54% YoY, and more than any Indian
FMCG company managed in FY22.
• The Government of India has earmarked a corpus of Rs. 1,000 crore (US$ 127.72
million) dedicated for research and development of the technical textiles sector.
• In March 2022, the Bihar government submitted a proposal to the Ministry of
Textiles to set up a mega hub under the PM Mitra Mega Textile Park.
• In March 2022, Tamil Nadu Chief Minister Mr. MK Stalin announced that the State
Industries Promotion Corporation of Tamil Nadu Ltd (SIPCOT) will set up a mega textile
park in the Virudhunagar district.
• Under the Union Budget 2022-23, the total allocation for the textile sector was
Rs. 12,382 crore (US$ 1.62 billion). Out of this, Rs.133.83 crore (US$ 17.5 million) is
for the Textile Cluster Development Scheme, Rs. 100 crore (US$ 13.07 million) for the
National Technical Textiles Mission, and Rs. 15 crore (US$ 1.96 million) each for PM Mega
Integrated Textile Region and Apparel parks scheme and the PLI Scheme.
• For export of handloom products globally, the Handloom Export Promotion Council
(HEPC) is participating in various international fairs/ events with handloom
exporters/weavers to sell their handloom products in the international markets under NHDP.
• The Ministry of Textiles has also been implementing the Handloom Marketing
Assistance (HMA), a component of National Handloom Development Programme (NHDP) all across
India. HMA provides a marketing platform to the handloom weavers/agencies to sell their
products directly to the consumers and develop and promote the marketing channel through
organizing expos/events in domestic as well as export markets.
• In November 2021, Minister of Textiles, Commerce and Industry, Consumer Affairs
& Food and Public Distribution, Mr. Piyush Goyal, stated the desire to target a 3-5x
time increase in the export of technical textiles worth US$ 10 billion over the next three
years.
• The Indian government has notified uniform goods and services tax rate at 12% on
man-made fabrics (MMF), MMF yarns, MMF fabrics and apparel, which came into effect from
January 1,2022.
• Minister of Textiles, Commerce and Industry, Consumer Affairs & Food and
Public Distribution, Mr. Piyush Goyal, announced a mega handloom cluster in Manipur and a
handloom and handicraft village at Moirang in Bishnupur. The mega cluster will be set up
at an estimated cost of Rs. 30 crore (US$ 4.03 million) under the National Handloom
Development Programme (NHDP).
• In June 2022, the Kerala government announced that it would provide free
training to 1,975 candidates under the SAMARTH scheme of the textile industry.
• In March 2022, the Bihar Government submitted a proposal to the Union Textiles
Ministry to set up a mega hub under the PM Mitra Mega Textile Park.
• Defence Research and Development Organisation (DRDO) is helping the Indian
textile industry to produce yarns and eliminate dependence on import of Chinese and other
foreign clothing for military uniforms. Indian defence sector has expressed support
towards the Indian technical textile sector.
Source:https://www.ibef.org/industry/indian-textiles-and-apparel-industry-analysis-presentation
Achievements
Following are the achievements of the Government in the past four years:
• In June 2023, Government has approved R&D projects worth US$ 7.4 million
(Rs. 61.09 crore) in textile sector.
• Huge funds in schemes such as Rs. 900 crore (US$ 109.99 million) for Amended
Technology Upgradation Fund Scheme (ATUFS) have been released by the Government in the
union budget of 2023-24 to encourage more private equity investments and provide
employment.
• Sangam India Ltd, one of the foremost producers in PV dyed yarn, cotton and OE
yarn and also ready to stitch fabric, has installed two solar power plants of 5 MW that,
on average, helps them to bring down their carbon footprint by at least 20% per annum. SIL
also plans to increase the use of recycled fibre, leading to lesser consumption of plastic
waste by using it as a raw material.
Strengths
• Availability of large varieties of fibre and has a fast growing synthetic fibre
industry.
• Low labour charges means that the manufacturing cost rarely spins out of
control.
• India has availability of abundant raw material which helps to control the costs
and reduces the lead time.
• India is one of the largest producers of cotton in the world and is also enjoys
abundant supplies of polyester, silk, viscose, among others.
• Industry has large and diversified segments that provide wide variety of
products.
• Indian textile industry is a self-reliant industry which has complete value
chain from the procurement of raw materials to the production of finished goods.
Weakness
• Lack of technological development affects productivity and other activities
across the value chain.
• The Indian industry falls short on the economies-of-scale front therefore unable
to compete with nations like China.
• Indian Textile Industry is highly Fragmented Industry.
• Rigid & unfavorable labor Laws.
• Lack of Trade Membership, which restrict to tap other potential market.
• Lacking to generate Economies of Scale.
• Use of outdated technology resulted in low productivity & production
capacities as compared to China.
• Comparatively high expenses like indirect taxes, power & interest.
Opportunities
• A number of initiatives have been announced to support the handloom and power
loom industries.
• A number of e-marketing platforms have been developed to simplify marketing
issue.
• Greater Investment and FDI opportunities are available.
• Large, Potential Domestic and International Market.
• Product development and Diversification to cater global needs.
• Elimination of Quota Restriction leads to greater Market Development.
• Market is gradually shifting towards Branded Readymade Garment.
Threats
• Low-cost players like Pakistan and Bangladesh may hinder Indias exports
prospects.
• Geographical Disadvantages relating to Export & Import of goods. Indias
geographical distance from major global markets of US, Europe and Japan in contrast to its
rival countries are comparatively nearer. This results in high shipping expenses and
lengthy lead times.
• Polyester manufacturers struggled to pass on high raw material costs due to
sluggish demand.
• Continuous Quality Improvement is need of the hour as there are different demand
patterns all over the world.
• Threat for Traditional Market for Power loom and Handloom Products and forcing
them for product diversification.
• To make balance between price and quality in order to compete with cheaper
imports.
Outlook
• The Indian textile sector considers the Union Budget 2023-2024
• To be growth oriented as it will enable the textile manufacturing sectors to
grow at a faster rate.
• With a view to support the "Make in India" initiative, the Central
Government Launched ATUFS (Amended Technology Upgradation Fund Scheme) in place of the
existing RRTUFS (Revised Restructure Technology Upgradation Fund Scheme), for technology
upgradation of textile industry with one-time capital subsidy for eligible machinery.
• It is the endeavor of the Company to improve its performance by adopting new
techniques of production, improve product acceptability and cutting/reducing costs
wherever possible.
Financial & Operational Performance
Risks and Concerns: Your Company has established a strong risk management
structure. Under this structure, the risks are identified across all business processes of
the organization on continual basis. The Company endeavors to mitigate the risks on an
ongoing basis by evaluating the progress of the projects being undertaken on a regular
basis and close monitoring.
• Liquidity Risk: The Company is into a highly capital intensive industry
segment. Non availability of funds or increased cost of funding will result in pressurized
margins. The Company requires a substantial amount of long term/short term funds to meet
its requirement for various Infrastructure/Construction projects. To manage this, the
Company proactively manages the debt levels from banks to provide adequate liquidity for
its operations.
• Government Policy Risk: There could be unfavorable regulatory measures in
Government policies towards the textile industry and may impact the long term planning of
the Company.
• The MAT (Minimum Alternate Tax): Regime if not taken out of the SEZs
might create difficulties in the sector as SEZs and the companies in the zones might not
be able to reap the benefits as originally enshrined in the SEZ act. Same risk may get
augmented if the SEZs are not allowed to sell in the Domestic Tariff Area in tandem with
the Free Trade Agreements with some countries
• Competition Risk: The top management of the Company reviews the risk from
time to time and as a measure of risk mitigation your Company has decided to focus only on
the core competency area so as to ensure that it is constantly moving up the value chain.
FINANCIAL REVIEW
During the period under review turnover of the Company marginally Decreased from Rs.
956.83Lakh to Rs. 77.08 Lakh i.e. an Decrease of 1125%. Company registered a Loss before
tax of Rs.-282.30 lakh against profit before Tax of Rs.3.52 lakh during F.Y 2022-23,
marginal increase in comparison to previous year. Further, the Company registered a Net
Loss after Tax of Rs. -222.37 Lakh from Net profit of Rs. 109.82 Lakh after adjustment of
Deferred Assets of Rs.-59.92 Lakh.
| Ratios (Standalone) |
For the year ended 31st March 2023 |
For the year ended 31st March 2022 |
| Debtors Turnover Ratio |
0.27 |
64.97 |
| Inventory Turnover Ratio |
1.13 |
12.63 |
| Interest Coverage Ratio |
-3.41 |
1.06 |
| Current Ratio |
2.90 |
1.10 |
| Debt Equity Ratio |
1.60 |
1.13 |
| Operating Profit Margin (%) |
-240.42 |
-17.31 |
| Net Profit Margin (%) |
-282.16 |
11.48 |
Human Resources: Human Resource Management is one of the key functions of the
Company. Your Company aims to create a working environment that attracts and retain the
best people, enhance their capability and provide enough motivation to ensure highest
level of productivity. The employees are encouraged to remain involved and contribute for
the growth of the Company. The industrial relations during the year continued to be
cordial and peaceful.
As on 31-03-2023 there were 05 permanent employees in the Company.
Cautionary Statement: The Management Discussion and Analysis Report contains forward
looking statements based upon the data available with the Company, assumptions with regard
to global economic conditions, the Government policies, etc. The Company cannot guarantee
the accuracy of assumptions and perceived performance of the Company in future.
| Place : Muradnagar |
Sd/- |
by order of the Board For SYBLY INDUSTRIES LIMITED Sd/- |
| Date : 14th August, 2023 |
(Ramesh Chandra Sharma) |
(Mahesh Chand Mittal) |
| Registered Office: |
Director |
Managing Director |
| Pawan Puri, Muradnagar |
(DIN : 00284981) |
DIN:00284866 |
| Distt. Ghaziabad |
18, Vinay Park, Govindpuri, |
Residential Address: |
| (U.P.) - 201206 |
Modinagar, Ghaziabad - 201204 |
Flat No 603, Tower-2, Orange County, |
|
|
Ahinsa Khand -1, Indirapuram, Ghaziabad, Uttar Pradesh 201014 |
+91-9892691696
