Ratings agency ICRA has said that Indian apparel exporters are expected to register a 9-11 per cent revenue expansion in current fiscal (FY25) aided primarily by gradual liquidation of retail inventory in key end markets and a shift in global sourcing to India. With the revival in demand, it expects the capex spending to increase in FY25 and FY26 and may stay in the range of 5-8 per cent of the turnover.
Further, it stated that the long-term prospects for Indian apparel exports are favourable, aided by enhanced product acceptance in end markets, evolving consumer trends and a boost from the government in the form of the production-linked incentive (PLI) scheme, export incentives, the proposed free trade agreement with the UK and the EU, among others.
It added that the expected growth this fiscal follows a tepid performance in FY24 when exports were affected because of high retail inventory, sluggish demand from the key end markets, supply chain issues, including the Red Sea crisis and heightened competition from neighbouring countries.
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