Indian textiles have been a chief item of trade since ancient times. The textile industry has been built on a solid foundation of the availability of various fabrics. India has a competitive edge in production and ranks second in worldwide cotton production, comprising hand-woven and modern mills. Investing in textile stocks could be a good opportunity for investors looking to grow in the textile industry.
Textile Industry in India – An Overview
The Indian tеxtilе and apparеl industry is еxpеriеncing significant growth. It is expected to reach US$190 billion by 2025-26. Being the third largest exporter, India holds a 4.6% share of global trade in tеxtilеs and apparеl. This contributes 2.3% to India’s GDP and is expected to double by thе еnd оf thе dеcadе.
The numbers look good for the industry. thе Manufacturing of Tеxtilеs Indеx grew 1.6% in August 2023, and Thе Indian Tеchnical Tеxtilе markеt еxpеctеd to grow by 15% by 2027. Cotton production is expected to rise, while natural fibers production is expected to reach US$195 billion by 2025.
To enable the growth of the textile industry, the government offers a Production-linked Incentive scheme worth Rs.10,683 crore for artificial fibers and technical textiles, bringing in Foreign direct investment (FDI) of between US$4.31 billion in April 2000 and June 2023.
Textile Stocks in India: An Introduction
India has leading industrial houses in the textile manufacturing business. Many textile stocks in India belong to companies with a 25-year operating history. Investors seeking exposure to this sector can explore textile stocks listed on Indian stock exchanges. These stocks represent companies across the textile value chain, from yarn production to finished garments. Understanding their performance can be beneficial for making informed investment decisions.
Textile Stocks in India
As textile stocks are growing so rapidly, here’s a list of textile stocks in India that you might like to keep an eye on:
| Textile Stocks | Market Cap in Crores as of 5.03.24 |
| Trident Ltd. | ₹ 21,108 |
| Indo Count | ₹ 6,446 |
| Welspun Living | ₹ 14,771 |
| Himatsingka Seide | ₹ 1,427 |
| Dollar Industries | ₹ 2,859 |
| Bombay Dyeing | ₹ 3,798 |
| BSL | ₹ 194 |
| Gokaldas Export | ₹ 4,879 |
| Arvind Limited | ₹ 7,288 |
| Vardhman Poly | ₹ 204 |
Top Textile Stocks In India
Here are the top 5 textile stocks to know this year.
Trident Ltd.
A veteran in the yarns, terry towels, paper, and chemicals segments, the company’s stocks have grown by 38% (5th March 2024) in one year, which is consistent with the company’s 5-year CAGR of 44%.
| Market Cap | CMP (as of 5th March, 2024) | All-Time High Level | PE Ratio | 5 yr CAGR Return | ROCE(FY 2023-24) |
| ₹ 21,108 Cr | ₹41.4 | ₹52.9 | 50.2 | 44% | 11.9% |
In the December 31, 2023 quarter, the company achieved a revenue of Rs. 1835 crores from its operations, marking an 11% increase compared to the Rs. 1641 crores generated in the same quarter last year. Despite this revenue growth, the profit declined by 24% in the recent quarter, amounting to Rs. 109 crore, compared to the previous year’s Rs. 144 crore for the same quarter.
Indo Count Industries Ltd.
Indo Count Industries Ltd., incorporated in 1988, manufactures 100% gray combed cotton yarn and knitted fabric. Its Home Textiles Division manufactures bed sheet sets, pillowcases, duvet covers, comforters, window coverings, and hospital linen. The company’s stock has grown by 146% last year, with a market cap of Rs 6,446 crores (5th March 2024).
| Market Cap | CMP (as of 5th March, 2024) | All-Time High Level | PE Ratio | 5 yr CAGR Return | ROCE(FY 2023-24) |
| ₹ 6,446Cr | ₹325 | ₹365 | 19 | 52% | 15.1% |
In the December 31, 2023 quarter, the total revenue from operations amounted to Rs. 713 crores, surpassing the revenue generated in the same quarter last year, which stood at Rs. 657 crores. The profit for the recent quarter reached 58 crores, marking an increase of 52% compared to the profit of Rs. 38 crores recorded for the same quarter last year.
Welspun Living Limited
A global leader in home textiles for over 35 years. The company manufactures various textile products under its three main bed, bath, and flooring segments. With a market cap of Rs 14,771 crores, the company has provided a 123% return over the last year (5th March 2024).
| Market Cap | CMP (as of 5th March, 2024) | All-Time High Level | PE Ratio | 5 yr CAGR Return | ROCE(FY 2023-24) |
| ₹ 14,771 Cr | ₹152 | ₹172 | 22.4 | 21% | 6% |
The total revenue from operations amounted to Rs. 2411 crores for the quarter ending on December 31, 2023, marking a remarkable increase of over 29% compared to the revenue of Rs. 1869 crores generated for the same quarter last year. The profit surged from 44 crores to Rs. 179 crores, representing a staggering increase of 306%.
Himatsingka Seide Ltd.
Himatsingka Seide Ltd. manufactures natural silk and silk-blended fabrics, silk woven yarn, and other products. The company’s product range includes decorative fabrics, bridal wear, fashion wear, and spun/ blended yarn. Listed in 2005, the company has good market experience. It has given a return of 74% over the last year (5th March 2024).
| Market Cap | CMP (as of 5th March, 2024) | All-Time High Level | PE Ratio | 5 yr CAGR Return | ROCE(FY 2023-24) |
| ₹ 1,424 Cr | ₹145 | ₹188 | 12.8 | – 4% | 3.77% |
The total revenue from operations was Rs. 723 crores, slightly lower than the Rs. 737 crores recorded for the same quarter last year, reflecting a marginal decline of 1.9%. Despite this slight decrease, the profit for the recent quarter soared to Rs. 31 crores, marking a remarkable increase of 1450% compared to the Rs. 2 crores profit recorded for the same quarter last year.
Dollar Industries Ltd
Established in 1972, Dollar Industries Ltd. is among the leading players in hosiery. It has a presence in 15 countries and is the highest-selling Indian innerwear brand in the UAE and the Middle East. Dollar Industries Ltd. is one of the listed textile stocks growing consistently. It has provided a 48% return in a year and a 12% five-year CAGR.
| Market Cap | CMP (as of 5th March, 2024) | All-Time High Level | PE Ratio | 5 yr CAGR Return | ROCE(FY 2023-24) |
| ₹ 2,859 Cr | ₹504 | ₹525 | 46.8 | 12% | 9.79% |
Revenue from operations reached Rs. 330 crores for the quarter ending on December 31, 2023, marking a growth of over 15% compared to the Rs. 285 crores recorded for the same quarter last year. Profit for the recent quarter amounted to 18 crores, doubling from the Rs. 9 crores recorded for the same quarter last year, representing a 100% increase in profits.
How To Identify The Best Textile Stocks To Buy In India?
The following are the important criteria when selecting textile stocks to add to your portfolio.
- Financial Analysis: Evaluatе tеxtilе companiеs’ financial hеalth from its kеy indicators likе rеvеnuе growth, profit margins, and rеturn on еquity to gaugе stability and profitability.
- Industry Positioning: Assеss companiеs’ markеt sharе and compеtitivе standing within thе tеxtilе sеctor to idеntify thosе poisеd for advantagеs in еconomiеs of scalе.
- Managеmеnt Quality: Examinе thе quality of the managеmеnt tеam, their track rеcord and govеrnancе practices.
- Valuе Chain Intеgration: Look for textile stocks of companies with intеgratеd valuе chains and divеrsе product offеrings to achiеvе cost еfficiеnciеs and maintain quality control.
- Dеmand Trеnds: Stay abrеast of global and domеstic dеmand shifts favoring textile stocks companies. Companies that adapt to changing consumеr prеfеrеncеs, еxplore international markеts and invеst in innovation are better positioned for long-term success.
Factors to Consider While Investing In Textile Stocks
- Market Conditions and Industry Trends: The textile industry depends on the performance of agriculture and the availability of inputs. Before investing in textile stocks in India, one must assess the demand for textiles, domestic and external conditions, and emerging consumer trends.
- Fundamentals of the Company: Gather information on how the profit, income, debt, and expenses components have been performing for 3-5 years. Read analyst’s views about prospects before investing in textile stocks.
- Government Policies: Government policies on taxation, investment, subsidies, incentives, and special schemes for the textile sector impact the performance of textile companies and, thus, textile stocks.
- Industry Position and Competition: Study the textile stocks company’s position in the textile industry and among its competitors. Assess its market share, challenges, and competitive advantages.
How to Invest In Textile Sector Stocks?
When looking to invest in textile stocks, here’s how you can do it:
- Invest in individual textile stocks by buying shares from a brokerage account.
- Invest in well-performing exchange-traded funds focused on the textile sector or one that tracks textile sector indices.
- Pick mutual funds that focus on textile stocks.
- Another investment option is fund-of-funds or managed portfolios exclusively focused on the textile sector stocks.
Conclusion
Considering its many positives, the textile industry is a preferred sector among investors. The government of India’s policy initiatives are set to boost it further. Here, we look at some promising textile stocks that may outperform the indices and deliver higher returns.
*Disclaimer Note: The securities quoted, if any, are for illustration only and are not recommendatory. This article is for education purposes only and shall not be considered as recommendation or investment advice by Research & Ranking. We will not be liable for any losses that may occur. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors.
Know more about
IPOs | Current IPOs | Upcoming IPOs| Listed IPOs
FAQ
Is it good to invest in the textile industry?
Whether investing in the textile industry is good or bad depends on understanding the textile stocks and the sector. With India having a stronghold in textile production and the government giving more encouragement, it can be a good sector to explore opportunities.
Will the textile industry grow in the future?
Yes, the textile industry will grow in the future. Bharat Tex 2024 is a mega event that will showcase India’s textile tradition, and it is expected to draw business interest from global buyers/ CEOs and policymakers. This will also boost Indian textile stocks further.
Who is the textile king of India?
Arvind Limited is known as India's textile or fabric king among the textile stocks listed on the stock exchange. It owns India’s first homegrown denim brand, Flying Machine. It also has other brands like Colt, Ruggers, and Excalibur. Its global brands include Arrow US. Polo Association, Calvin Klein, Tommy Hilfiger and Flying Machine.
I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.