Anil Sasi

New Delhi , July 15

INDIAN textile exporters are planning to move up the value chain by foraying into the high-margin branded garments and home textile markets in the US and the EU.

Arvind Mills, which has so far been supplying to retailers including Wal-Mart, JC Penny, and Marks & Spencer, is working on the possibility of launching its own brand of garments in the US, according to industry sources. Terry towel major Welspun Industries Ltd has already started handling the manufacturing, marketing and distribution of a brand of towels in the US and Canada.

SK Birla-owned textile firm Birla VXL Ltd is also planning promotion of its own brand of readymade garments in the western markets, especially the US, industry players said. Smaller players are also getting into the act. Noida-based A&T Exports is ramping up the distribution of its own design label through outlets including high-end stores such as Selfridges and Designers Guild in London, Brown Thomas In Ireland, Le Bon Marche in Paris, Barneys in New York, TAD in Milan and Rome, Lane Crawford in Hong Kong and Club 21 in Singapore.

"The net realisation per item for an exporter is several times higher in case of branded products. In the medium to long term, Indian exporters would have to try and get a piece of the branded segment or to float their own brands in the western markets to counter the squeeze in margins being experienced following the quota phase-out," a Delhi-based exporter said.

Several of the other bigger Indian textile players are also trying to emulate Chinese exporters, who are frantically buying up US textile and apparel brands. According to industry players, some Indian exporters have shown interest in buying out established apparel and home textile brands belonging to bankrupt US textile retailers such as Pillowtex, West Point Stevens and Dan River.

Indian exporters are, however, expected to face stiff competition from Chinese players, who have already made headway in acquiring these brands in a big way. The Hong Kong-based trading major, Li & Fung, has already picked up two of the most well-known home textiles brands in the US — Cannon and Royal Velvet from Pillowtex.

Following the phase-out of the quota regime in global textile trade from January this year, Indian exporters have emerged as major suppliers of textile items to buyers in the US and EU. They have, however, not been able to break into the high-margin branded segment and the foreign buyers and retailers have largely undertaken the branding of Indian exports so far.

The Government has, on its part, been trying to promote the branding of exports and the Ministry of Textiles is expected to come out with a policy for increasing India's market share through brand building. The Chinese administration is also encouraging textile enterprises to concentrate more on the high-end segment and the Chinese textiles industry is also increasingly looking at branding, fashion and design as the prime focus areas, industry players said.

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