RMG sector outlook in FY24

02 October 2023, Mumbai

Key takeaways:

• Revenue growth to be driven by domestic demand and export revival
• Lower cotton prices and easing supply chain issues to support growth
• Volume growth estimated to be 6-8%, higher than last year

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However:

• Revenue growth rate to be lower than last year due to stabilized raw material prices and lower realizations

Overall:

The Crisil Ratings report paints a positive outlook for the RMG sector in FY24, with revenue growth expected to be higher than the previous fiscal year, driven by strong domestic demand and export revival. However, the revenue growth rate is expected to be lower than last year due to stabilized raw material prices and lower realizations.

Additional notes:

• The RMG sector is a major contributor to the Indian economy, accounting for over 10% of the country's exports.
• The sector employs over 50 million people, making it one of the largest employers in the country.
• The Indian government is targeting to increase RMG exports to $100 billion by 2030.

Conclusion:

The RMG sector is poised for growth in FY24, driven by strong domestic demand and export revival. However, manufacturers and retailers should be mindful of the lower revenue growth rate due to stabilized raw material prices and lower realizations.

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