undefined share price Management discussions


:global economy

Despite the global growth rate slowing down to 3.2% in 2022, which was more than 1% weaker than anticipated in 2021, there have been recent positive indications of improvement. Although headline inflation started to decline, it remained elevated and persisted for a prolonged duration. Fortunately, the recent decline in energy and food prices has been a significant contributing factor to the early 2023 surge in activity and sentiment. Even though these prices remain relatively high compared to pre-Russia-

Ukraine war levels, their decrease bolstered the purchasing power of businesses and households. This, in turn, has helped to alleviate headline inflation. Additionally, the abrupt early reopening of China had a positive impact on global activity, easing supply chain pressures and providing a significant boost to international tourism.

The growth rate in advanced economies is projected to slow down significantly, declining from 2.7% in 2022 to

1.3% in 2023, primarily due to geoeconomic fragmentation. In contrast, emerging markets and developing economies are anticipated to have better economic prospects, with the average growth rate estimated to reach 3.9% in 2023, and a predicted increase to 4.2% in 2024. The slowdown was primarily attributed to the Russia-Ukraine conflict, which led to a cost-of-living crisis in multiple countries.

The expected recovery for the next two years is projected to be moderate.

While certain countries, regions, and territories have made notable strides in recovering from the Covid-19 pandemic, the global outlook continues to be uneven. For several nations, pre-existing political and economic challenges have hindered progress, making the road to recovery an uphill task. Despite the headway made, the global economy is preparing itself for another round of obstacles. This is due to the sluggish pace of structural reforms, increasing trade tensions, dwindling direct investment, and slower adoption of innovation and technology in fragmented regions. Nevertheless, it is widely anticipated that this downturn will be moderate, offering all countries an opportunity to effectively address global issues.

India has emerged as a significant player in the global economy. It has made impressive progress over the past decade, upgrading from the tenth to the fifth-largest economy in the world. The countrys economic success can be attributed to crucial reforms, such as liberalisation, streamlining bureaucracy, reducing corruption, investing in infrastructure, and improving access to financing for small and medium-sized enterprises.

However, the country has been facing the challenge of dealing with inflation. The combined efforts of the Government and the Reserve Bank of India, coupled with a decline in global commodity prices, helped retail inflation to fall below the RBIs upper tolerance target. Despite these daunting challenges, Indian economy achieved a growth rate of 7.2% in 2022-23.

The anticipated growth of the Indian economy is a testament to its resilience, with private consumption driving growth instead of relying on export incentives. This increase in private consumption has also stimulated production activity, resulting in higher capacity utilisation across several sectors. Additionally, the Indian Governments focus on infrastructure has been noteworthy. The introductions of the National Infrastructure Pipeline (NIP) in 2019, and the

National Monetisation Pipeline (NMP) in 2021, have laid a strong foundation for infrastructure development in India, presenting multiple opportunities for foreign investment and collaboration.

Indias economic growth prospects are expected to improve due to several factors. These factors include the normalisation of supply chains and the return of capital flows to India, supported by a stable domestic inflation rate that is below 6%. These developments are likely to increase private sector investment and boost business confidence. As a result, the survey predicts a baseline real GDP growth rate of 6.5% for 2023-24.


The textile industry is a major sector that encompasses various activities associated with the design, production, and distribution of textiles and clothing. It includes a wide range of products, such as fabrics, yarns, apparel, home textiles, and technical textiles. The projected compound annual growth rate (CAGR) of 5.67% for the worldwide textile industry during the period 2022-2027 indicates a promising growth trend. This growth is expected to be driven by various factors, such as increasing population, rising disposable income, and changing fashion trends. The demand for textiles and clothing is anticipated to rise with an increase in population, especially in emerging economies, such as India and China.

In the apparel sector, the industry has been driven by factors, such as increasing disposable income, a growing global population, and the rise of e-commerce. Online shopping has become increasingly popular due to its convenience, a wider range of options, and lower prices, which have been further accelerated by the Covid-19 pandemic. Consequently, the online channel has experienced growth and now accounts for 15.9% of the industrys total value, with expert online retailers leading the way.

Additionally, the textile and apparel industry is also witnessing a shift towards sustainable and eco-friendly practices. This shift is further driving the growth of the industry. Consumers are becoming more conscious of the environmental impact of clothing production, and they are now opting for sustainable clothing options. This transition towards sustainable practices has also resulted in the emergence of new markets, especially within the ecofashion sector.

The textile industry plays a critical role in Indias economy and export industry, covering a wide range of activities, from traditional hand weaving to modern textile mills. India has long been recognised as a manufacturing hub for the textile and apparel industry, ranking sixth globally in terms of exports. In addition, Indias technical textiles market is valued at around USD 16 Billion, constituting approximately 6% of the global market. China is the only country that produces more man-made fibres (MMF) than India, making India the second-largest MMF producer in the world.

The textile and apparel industry makes a significant contribution to Indias economy, accounting for 2.3% of the countrys GDP, 7% of industrial production, 12% of exports, and 21% of total employment. This sector is primarily dominated by small-scale players due to the economic feasibility of apparel manufacturing at various scales.

The industrys competitive advantages reside in its skilled workforce and cost-effective production methods.

Indias major textile and apparel export destinations are USA, EU-27, and UK, which comprise approximately 50% of the countrys exports in this sector. The country holds a 4.6% share in the global trade of textiles and apparel. In terms of employment, the textile and clothing industry is the second-largest employer in India, with over 45 Million individuals employed directly and an additional 100 Million employed indirectly in related industries.

According to a recent report by IMARC, the Indian textile and apparel industry has reached a market size of USD 172.3 Billion in 2022. It is expected to reach a compound annual growth rate (CAGR) of 14.59% in 2028, with an estimated market value of USD 387.3 Billion in 2028. This impressive growth can be attributed to several factors, such as the increasing demand for high-quality clothing and footwear, the Governments implementation of schemes to empower weavers, and the growing popularity of ethically sourced sustainable materials.

After China, India ranks as the worlds second-largest producer of man-made fibres. The man-made fibre value chain in India is vertically integrated, encompassing upstream and downstream linkages that span from raw materials to finished goods. The majority of Indias domestic man-made fibre (MMF) industry is made up of polyester and viscose, accounting for approximately 94% of the industrys volume. Demand for MMF is expected to increase due to factors, such as its use in non-wovens and technical textiles, changing consumer trends, and the rising popularity of fitness and hygiene products.

Although Indias traditional emphasis is on cotton textiles, there is a rising global demand for MMF, necessitating the need for the countrys textile industry to adapt. Indias exports of MMF textiles and apparel were USD 9.56 Billion for 2021-22, and have further potential to grow. To support the growth and employment potential of the MMF sector, the Production Linked Incentive (PLI) Scheme for textiles has been implemented with an approved outlay of ? 10,683

Crore over five years. This scheme aims to promote the production of MMF apparel, fabrics, and technical textile products in India to improve the sectors competitiveness. The increased availability of MMF and MMF yarn is expected to contribute to the overall growth of Indias textile industry using mixed fibres and yarn.

Cotton is the predominant segment of Indias yarn industry, accounting for over 50% of its market share. The growth of the textile sector is expected to have a positive impact on the yarn market, particularly in the cotton yarn segment, which holds a major share of the apparel industry.

With the population increasing and purchasing power strengthening, the apparel industry is anticipated to expand further. This is further projected to create a higher demand for cotton yarn in the textile manufacturing industry. Consumers in Tier-I and some Tier-II cities are increasingly seeking innovative designs, styles, and comfortable fits.

To keep up with this demand, there has been an increase in innovative manufacturing that incorporates the latest fabrication technology. Established players in the market are facing competition not only from unorganised players catering to 60-65% of total demand but also from new and emerging brands.

(Source: hllps://lexm:n.n:c.:n/s:les/deiau!i/h!es/tng!:sh%2Qr:n8!%2QMUT%2Q

With the rise of a new India that follows global fashion trends, the innerwear industry is experiencing rapid growth. The womens innerwear segment is expected to reach ? 68,000 Crore by 2028, while the mens innerwear segment is projected to reach ? 21,800 Crore by 2028. Over the last few decades, the innerwear industry in India has emerged as one of the fastest-growing categories. From being a basic essential, innerwear has transformed into a trendsetting fashion statement, synonymous with style, comfort, and personal expression. Currently, the Indian innerwear market accounts for approximately 9% of the total domestic fashion retail market.

The global activewear market is projected to expand from USD 421 Billion in 2022 to USD 779 Billion in 2032, witnessing a CAGR of 6.4% during the period 2022 to 2032. On the other hand, the Indian activewear market, including footwear, is expected to reach USD 12.47 Billion by 2024. Indian companies have emerged to meet the growing demand from consumers, offering quality products at affordable prices and keeping up with the trends. With rising incomes and international exposure, more people are likely to invest in high-quality and innovative activewear products. Brands must offer unique and functional products to stand out in this competitive market. Overall, the activewear industry in India is undergoing a significant transformation, with a shift in perception and increased demand for fashionable and innovative sportswear.

The textile and apparel industry holds immense socioeconomic significance in the Indian manufacturing sector. It is one of the largest employment generators and a significant contributor to the countrys foreign earnings. Due to its strategic importance to the Indian economy, the Government of India has implemented various initiatives to bolster its growth.

I The Indian Government has been actively promoting the growth of the textile industry through various initiatives and schemes. These initiatives and schemes include Make in India, Production Linked Incentive (PLI), National Technical Textiles Mission, Government e-Marketplace (GeM), Mega Textile Parks, Skill India, Womens Empowerment, and Rural Youth Employment, among others. The objective of these schemes is to encourage technology upgrades, infrastructure creation, skill development, and overall sectoral development in the textile industry.

I The Scheme for Capacity Building in Textile Sector (SAMARTH) was created to address the skilled workforce requirements of the textile industry.

The scheme was developed in line with the Skill India initiative and aligned with the Ministry of Skill Development and Entrepreneurships skilling programme framework. SAMARTH has been approved for implementation until March 2024.

The Amended Technology Upgradation Fund Scheme (ATUFS) was launched in January 2016 to promote the promote ease of doing business in India, generate employment, and encourage exports through the Make in India initiative. The scheme provides a credit- linked Capital Investment Subsidy (CIS) to units in the textile sector (excluding spinning) for the purchase of benchmarked machinery. The goal is to achieve Zero effect and Zero defect in manufacturing.

The Pradhan Mantri Mega Integrated Textile Region and apparel (Pm MITRA) Scheme was approved by the Indian Government to establish seven textile parks in greenfield and brownfield sites, with an outlay of ? 44.45 Billion over a period of seven years, up to 2027-28. The goal of PM MITRA is to enhance the competitiveness of the Indian textile industry, attract significant investment, and boost employment generation. The most recent edition of the scheme aims to build a total of 65 textile parks in India.

The Production Linked Incentive (PLI) Scheme has

been introduced to promote the production of MMF apparel, MMF fabrics, and technical textile products in India. The schemes goal is to create 60-70 global players, attract fresh investment of approximately ? 190 Billion, and generate almost 750,000 new employment opportunities in the country.

The Indian Government has approved the continuation of the rebate of State and central taxes and levies (RoScTL) for apparel/garments, and made-up exports at the same rates as issued by the Ministry of Textiles until 31st March 2024. This decision aims to provide a tax rebate on outbound shipments to garment exporters, thereby boosting the competitiveness of the labour-intensive textile industry.

Free Trade agreement: The Ind-AUS ECTA is expected to boost Indias textile and apparel exports significantly, with projections indicating an increase to USD 1,100 Million within the next three years. This agreement is poised to positively impact the Indian textile industry by facilitating increased trade between India and Australia.

Basic materials, including cotton, wool, silk, and jute, are widely available.

Exports demand is on the rise for the Indian textile industry globally.

India enjoys a comparative advantage in terms of skilled workforce and cost of production, relative to major textile producers.

The Indian textile industry has been investing in technology and modernising its operations to improve efficiency, productivity, and quality.

The Indian Government has approved 100% FDI in the textile industry under an automatic route.

Domestic demand for the industry has been stimulated by a growing population, rising per-capita income, and evolving tastes and lifestyles.


India is a major exporter of textile and apparel products, with increasing demand from countries, such as USA, Europe, and Japan. This presents opportunities for businesses to expand their exports and tap into the growing global market. This is supported by the Governments signing of economic cooperation and trade agreements with countries like Australia and the UAE, where now exports face zero duty.

India has a comparative advantage in terms of a skilled workforce in the textile and apparel sectors. The availability of skilled labour at a lower cost presents an opportunity for manufacturers to produce quality products at a competitive price.

The demand for environmentally friendly fibres has experienced exponential growth, coupled with a surge in their per capita usage. This can be attributed to the increasing average disposable income of households, evolving textile trends, and the global urbanisation phenomenon. These factors have resulted in higher demand for high-quality fibres and textiles. Furthermore, both consumers and retailers are seeking a broader variety of fibres and yarns to meet their diverse needs.


The demand for textile and apparel products can be volatile, particularly in response to changes in fashion trends, economic conditions, and consumer preferences. This can impact businesses that are not able to adapt quickly to changing market conditions.

A huge amount of raw material in the textile industry comes from agriculture. Thus, unfavourable climatic conditions like floods, droughts, and unseasonal rains affect the availability, quality, and prices of raw materials, which adversely affects the industry.

Globally, the textile industry is the second-largest consumer of water, following the agricultural sector. Moreover, the industry extensively uses harsh chemicals that are non-biodegradable and environmentally hazardous. As a result, the trend towards sustainability and eco-friendliness has been gaining momentum, with Governments imposing stringent regulations to ensure compliance with environmental standards.

The Indian textile industry is highly fragmented, with the unorganised sector and small to medium-sized businesses as the dominant players. Unlike its neighbour Bangladesh, where the average factory houses 500 machines, the average size of a textile unit in India is only 100 machines.


Sangam (India) Limited (referred to as SIL or The Company) is in the business of textile and garment manufacturing. The Company has a diversified product portfolio of PV-blended dyed fabric, grey yarn, textured yarn, cotton spun yarn, cotton open-end yarn, fabric processing, cotton knitted fabric, synthetic blended fabric, denim fabric, and garments. SIL was incorporated in 1984 with only eight weaving machines. Since then, it has achieved remarkable growth, expanding its reach to over 58 countries, and earning a prominent position as a leading brand in the textile sector. The Company is listed on the Bombay Stock Exchange and the National Stock Exchange.

SIL operates five modernised production facilities, each with cutting-edge technology and a proficient workforce, in the Bhilwara district. In addition, the Company has expanded its reach to 58 nations, making it one of Indias major textile exporters and a key player in the global textile ecosystem. Today, it has five highly-organised production bases equipped with the latest technology and a skilled workforce. These production bases are spread across the Bhilwara district, positioning the Company as one of the largest producers of PV-dyed yarn at a single location.

SIL has a long-standing presence dating back over 35 years and has established various brands under its belt. The Companys flagship brands include Sangam Suiting and Sangam Denim. Brand C9 Air Wear has a line of progressive seamless wear for women. The Company is one of the niche players in seamless garment manufacturing in India. SIL has a diversified client base across segments and geographies worldwide. The Companys client portfolio includes brands like Banswara Syntex, Siyaram, BSL, Vimal, RSWM Limited, Arvind Limited, Trident Limited, Marks & Spencer, Reliance Trends, Zivame, Myntra, Lifestyle International, Benetton and Westside, among others.



AS OF 31st MARCH, 2021

AS OF 31st MARCH, 2022

AS OF 31st MARCH, 2023

Spindles (nos.)




Open-end rotors (nos.)




Texturising machines (nos.)




Knitting machines (nos.)




Denim fabric processing lines (nos.)




Indigo rope dyeing range (M/c nos.)




Weaving machines (no. of looms)




Fabric processing (MMPA)




Garment processing (MTPA)




Seamless garments knitting machines (nos.)




Captive coal-based thermal power plants (in MW)




Captive solar power plants (in MW)




Wind power plants (in MW) in Jaisalmer






PARAMETER YARN fabric garments
Revenue contribution PV yarn: 34% PV fabric: 19% Garments: 3%
(2022-23) Cotton yarn: 16% Cotton fabric: 25%
Geographic presence Domestic: 76% Domestic: 65% Domestic: 90%
(by revenue share) Export: 24% Export: 35% Export: 10%
Market position Coloured PV yarn holds a market share of approximately 25% in India SIL holds a mid-sized market share in the diversified fabric and denim market SIL is an established and specialised player in the premium segment of womens activewear and sportswear in India
Customer Manufacturer of synthetic and cotton fabric Manufacturer of synthetic & denim garment and apparel Retail customers
There is a growing trend towards personal appearance Increasing population
Demand drivers The textile industry is witnessing a rise in the production of natural fibres like cotton, silk, and wool, which are becoming increasingly popular The direct-to-consumer (D2C) model is becoming a significant driver of demand for garments


SILs strategic venture, C9 Airwear, has established a dominant market position in the womens innerwear industry. The Company offers a range of products, including leisure wear, activewear, intimate apparel, and shapewear, through its website, www.c9airwear.com, as well as on several third-party shopping platforms, such

as Myntra, Nykaa, Amazon, Flipkart, and Ajio. Due to its advanced technology, the Company can annually produce up to 50 lakhs of seamless garments. This allows it to provide customers with a diverse range of premium fabric choices.




% change

Key Financial Ratios
Debt equity ratio




Interest coverage ratio




Liquidity Ratios
Current ratio (incl. current maturities of long-term debt)




Current ratio (excl. current maturities of long-term debt)




Debtors turnover (no. of days)




Inventory turnover ratio (no. of days)




Profitability Ratios
Operating profit margin




Net profit margin




Return on net worth






SILs processes for risk identification, assessment, mitigation, and reporting are supported by an effective framework for risk management. The Risk Management Committee of the Company identifies a range of risks that

may affect its operations, including business dynamics risks, market risks, political risks, environmental risks and liquidity risks. Thereafter, SIL assesses those risks and develops a plan for reducing them.


The success of an organisation is closely linked to the level of satisfaction among its employees. SIL places great emphasis on the importance of hiring a diverse workforce and values the unique contributions that each employee brings to the table. The Company acknowledges that its intellectual capital is its most valuable asset, and any loss of it would have a significant negative impact

on its performance. Its primary objective is to attract and retain competent employees, while fostering a workplace environment that is fulfilling, safe, welcoming, and supportive of career growth.

Over the past year, the Company has undertaken several projects to enhance its HR systems and procedures, while also introducing new tools to improve the overall employee experience. These initiatives focus on leadership development, succession planning, performance and recognition, employee engagement, and employer branding.

SIL has designed a systematic learning and development process to promote lifelong learning and skill development among its employees. As of 31st March 2023, the Company employed around 12,000+ people across various locations and departments.

By emphasising the importance of a varied and engaged workforce, SIL is taking important steps towards ensuring its success and growth in the long-term.


SIL maintains appropriate and effective internal control systems, which are aligned with the size and complexity of its business. According to the Companys perspective, among other considerations, these systems offer a fair guarantee that transactions are carried out with management authorisation. These systems have been implemented at every level. They are meant to ensure compliance with statutory and regulatory requirements for internal controls, as well as the accurate recording of financial and operational data. The permissible compilation of financial accounts is ensured by generally accepted accounting standards. Moreover, the sufficient protection of the Companys assets from major misappropriation or loss is also assured. A crucial component of SILs internal control system is an independent internal audit function.

In addition to this, the Company also has a robust internal audit programme and regular reviews by Management and the Boards Audit Committee.


Statements made in this Management Discussion and Analysis Report may contain certain forward-looking statements based on various assumptions about the Companys present and future business strategies and the environment in which it operates. Actual results may differ substantially or materially from those expressed or implied due to risks and uncertainties. These risks and uncertainties include the effects of economic and political conditions in India and abroad, volatility in interest rates and the securities market, new regulations and Government policies that may impact the Companys businesses, as well as the ability to implement its strategies. The information contained herein is as of the date referenced, and the Company does not undertake any obligation to update these statements. The Company has obtained all market data and other information from sources believed to be reliable or its internal estimates, although its accuracy or completeness cannot be guaranteed.