The Indian home textile industry is on the cusp of a significant resurgence, with projections indicating an 8-10% surge in sales for the fiscal year 2025 (FY25). This positive outlook follows a challenging FY23, marked by economic headwinds and supply chain disruptions.
Key Drivers of Revival
Several factors are driving this optimistic forecast:
- Rising Affluence: A growing middle class with increasing disposable income is fueling demand for high-quality home textiles.
- Urbanisation: Rapid urbanisation is leading to a surge in housing construction, creating opportunities for home furnishing products.
- Enhanced Hygiene Awareness: The COVID-19 pandemic has heightened consumer awareness of hygiene, driving demand for products like bed linens, towels, and curtains.
Global Market Dynamics
The global home textile market is thriving, with an estimated value of USD 122 billion in 2023. This figure is expected to reach USD 134 billion by the end of 2024 and further soar to USD 185 billion by 2030, reflecting a Compound Annual Growth Rate (CAGR) of 5-5.5%.
China currently dominates the global market, exporting approximately USD 23 billion worth of home textiles annually. India follows closely with exports of USD 5.7 billion, and Turkey holds the third position with USD 4.2 billion. The United States remains the largest importer, accounting for 30% of global imports, while India ranks second at 29%.
India’s Export Performance
India’s domestic textile exports witnessed a robust 12.27% growth between 2019 and 2023, solidifying the country’s position as a major player in the US market. Carpets, rugs, bed linens, and kitchen linens are among the most popular export items. However, the industry faced challenges in FY22, primarily due to soaring cotton prices and increased freight costs stemming from the Russia-Ukraine conflict. As a result, exports declined by 12% year-on-year in FY23.
Road to Recovery in FY25
Despite these setbacks, the industry has embarked on a recovery path in FY24, with exports trending upwards, particularly to the US market. Stabilising cotton prices and declining freight costs have improved profitability for manufacturers. Additionally, Indian home textile companies are investing in capacity expansion to meet growing global demand.
CareEdge Ratings forecasts that the industry will maintain operating margins of 14-15% in FY25, supported by stable raw material prices and strong demand from key markets like the US and Europe. While freight costs continue to pose challenges, the shift towards sustainable and eco-friendly products is expected to drive future growth.
India’s strategic advantage lies in its alignment with the “China+1” strategy, as multinational corporations seek to diversify their supply chains away from China. This presents a significant opportunity for Indian exporters to capture a larger market share.
