Polyester will generate 18-20% revenue growth this fiscal year: CRISIL

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With healthy demand and increased blends with cotton yarns due to high cotton prices over the past decade, polyester will drive revenue growth of 18-20% this fiscal year for the cotton industry. manufacture of polyester yarn.

Claiming this, CRISIL, an Indian analyst firm providing ratings, research and risk and policy advisory services, said better profitability and expected modest capital outlays will improve the credit profiles of polyester yarn manufacturers.

CRISIL reports that the recovery in demand from these end-user segments and multiple price increases resulted in revenue growth of 60% last fiscal year, albeit from a low base, with sales volume up 15 %.

Demand is also expected to remain healthy this fiscal year, with the apparel and home textiles segments expected to grow 16-18% and 12-13%, respectively, in fiscal 2023, driven by the recovery in demand. domestic market and moderate export growth.

Polyester yarn is mainly used in sports and leisure wear, other apparel, and home textiles.

Gautam Shahi, Director of CRISIL Ratings, says: “Polyester yarn is cost effective to blend with cotton yarn, and as cotton yarn prices have increased by 25% over the past year, a larger blend increased the demand for polyester yarn.

He further added that with an increased spread between cotton and polyester yarn prices to hold, we expect 4-5% of cotton yarn demand to shift to polyester yarns. This shift is expected to continue for most of this fiscal year as end-user segments operate in a competitive pricing environment.