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Tuesday, Mar 09, 2004

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Textiles stocks draw special attention

Jayanta Mallick

Kolkata , March 8

TEXTILES counters today drew attention of a section of investors over general and specific value-related issues. According to analysts, the broad impetus that has come off recently was inclusion of textiles items for potential bilateral trade between India and Pakistan. The business leaders of the two countries have identified textiles, among a few others, for future trade growth.

"Some of the textiles stocks moved up today on value buying. The stocks had fallen from their peaks for some time. The renewed interest is a reminder of the sector's long-term prospects," commented Mr Devarsh Vakil of Anagram Stockbroking. During the last quarter, reported scouting for long-term sourcing arrangement with Indian textiles outfits by some global retail majors had weaved the prices of textiles stocks up.

From January 1, 2005, the quota regime (involving 137 countries) under WTO will go off. After China, India is supposed to enjoy the growth potential in the global textiles market. The domestic players in the sector are also gearing up to meet the challenge in the free-for-all scenario that is to unfold after three quarters.

Among today's gainers on the bourses were Raymond, Arvind Mills and Century Textiles. Alok Industries, however, slipped on the news of proposed increase in authorised capital through issue of shares.

Arvind Mills has stabilised production at its new 2.4 million units per annum readymade shirt plant as also the 2.1 million units jeans manufacturing facility in the Mauritius (through its subsidiary). Further, the company has made arrangements for a changeover to gas-based captive power generation from a naphtha-based one. This will provide savings of around 25 per cent of energy cost from Q2 of 2004-05.

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