Leather footwear exporters facing significant hurdles due to challenging environment: ICRA

06 Oct 2017 Evaluate

Domestic credit rating agency, ICRA in its latest report has said that the leather and leather footwear exporters has been facing significant hurdles due to a challenging internal as well as external environment. It also noted that demand has been impacted due to the weak consumer sentiment in the European Union (EU - the biggest destination of India's footwear exports) and a significant drop in the value of the British Pound (GBP) following the vote on referendum to exit the European Union. Apart from this, it stated that the sector is also facing headwinds due to rupee appreciation against major currencies and recent regulatory restrictions placed on slaughter of animals and on leather tanneries, impacting raw material availability.

The rating agency has said that because of these factors, the leather export figures showed downtrend for the two consecutive years, by 9 percent in FY16 and 5 percent in FY17. Therefore, it expects that similar trends to continue in the near term which should impact the earnings of export focussed leather footwear players. On the domestic front, it noted that while the Indian footwear industry has historically recorded a healthy growth driven by increasing footwear demand and average selling price (ASP), growth has slowed in FY16 and FY17 due to moderation in consumer sentiments.

As per the report, the revenues of export-focussed leather footwear players declined by 2 percent in FY17, while the revenues of players focussed on the domestic market involved in leather as well as non-leather products saw a growth of 3 percent in FY17. It also highlighted that aggregate operating profitability margin of the entities focussed on exports has declined, from 14.1 percent in FY16 to 12 percent in FY17, while the aggregate operating profitability margin of companies focussed on the domestic market has declined modestly from 12.2 percent to 11.9 percent during this period.

ICRA further mentioned that though the players focussed on leather products and export markets are likely to face headwinds due to combination of internal and external factors and may see pressure on revenues, the credit risk profile is likely to remain comfortable on account of limited leverage and lower expected capex. On the other hand, it said that the revenue of those entities, which are focussed on domestic market is likely to see healthy improvement, once the impact of demonetisation and GST wanes out, and these players are likely to report better credit metrics.

Create stable, long-term investment portfolio with strong, consistent stocks.

Start Research-backed Investing ...Now. Subscribe to Sapphire

About MoneyWorks4Me

MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.

Our Vision

To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.

What Makes MoneyWorks4Me Different

Fiduciary-first advisory model.
As SEBI-registered IAs, we are legally and ethically bound to act in the best interests of our clients. We do not sell or distribute any financial products. This ensures our guidance is 100% unbiased and conflict-free.
Deep fundamental research + robust valuation discipline.
Built on more than 15 years of equity research, our framework combines quality assessment, intrinsic value estimation, and a sensible margin-of-safety approach.
Process—not predictions.
We don’t rely on guesswork or market timing. Instead, we focus on asset allocation, risk management, and long-term compounding.
Technology + Human Intelligence.
We believe a combination of both is essential for investing success. We constantly innovate and upgrade in-house tools, financial X-rays, and portfolio analytics so that our team of analysts and advisors are equipped with the best.
Partner with Clients.
We follow a DIWM (Do-It-With-Me) approach where we partner clients in setting goals, financial planning, educating on our investing process and share decision-enabling resources transparently with our clients who retain control on execution.

Our Approach: Ensuring compounding work its magic on client portfolio.

MoneyWorks4Me ensures this through:

Investing in stocks, mutual funds, debt, and gold
Quality-at-Reasonable-Price way of investing in stocks
Constructing Direct Stock Portfolios with Core, Booster, and Amplifier stocks
A Mutual Fund Portfolio that delivers consistent out-performance and meaningful diversification (low overlap)
Periodic review and rebalancing
Clear Buy-Sell-Hold, and Position-sizing frameworks

Name of the IA registered with SEBI:	The Alchemists Ark Pvt. Ltd.
Logo:
Trade/Brand Name of IA:	MoneyWorks4Me Investment Advisers
Brand Logo:
SEBI Registration Number:	INA000013323 Validity – May 16, 2019 – Perpetual
Registration:	Non-Individual
BSE Enlistment No:	1187
Address:	B-101, Signet Corner Building, Balewadi Phata, Baner, Pune, Maharashtra 411045
Compliance officer Details:	Name: Shrikant Jagtap Email: shrikant.jagtap@moneyworks4me.com Telephone: +919860359463 Address: Same as IA
Grievance Officer Details:	Name: Mukta Vaze Email: mukta.vaze@moneyworks4me.com Telephone: +91 98609 19463 Address: Same as IA
Principal Officer Details:	Name: Atharva Bhide Email: atharva.bhide@moneyworks4me.com Telephone: +91 91758 99463 Address: Same as IA
Standard Warning:	Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Disclaimer:	Registration granted by SEBI, enlistment with exchange and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.