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Machinery uptrend

After textile counters, now textile machinery counters are in the limelight. Stocks of major machinery companies have firmed up significantly in the past few weeks. In the last one month, LMW has gained 65 per cent, while Textool 58 per cent and Stovec Industries 20 per cent. The stock of Veejay Lakshmi Engineering has almost doubled. All these firms have posted an impressive performance during the last fiscal. There is no reason that these companies don’t sustain this performance in the future too since the situation in the textile industry is definitely looking up after a long sluggish phase. However, the domestic machinery sector needs to gear up to face the challenges that are going to emerge in the coming months. In fact, the entire industry calls for some re-orientation and change in strategy looking at the future market trend. The industry, in the past few years, has failed to bring about necessary changes in their product range as also market strategies. It is high time that the industry focuses on R&D in joint ventures and manufactures machinery as per the requirements of the consumer industry. This will call for constant interaction among machinery players, textile units and textile research associations. The sector no longer can afford to work in isolation as it has been doing in the past. There is need to adopt new technologies to bring down the cost of production to be globally competitive.

Production of machinery and accessories during 2001-02 saw a fall of 17.90 per cent at Rs 1073.40 crore as against Rs 1308.56 crore year before. Moreover, imports of machinery has seen a growth of 2.60 per cent at Rs 1392.96 crore as against Rs 1357.62, while exports of textile machinery and accessories from the country fell to Rs 427 crore in 2001-02 from Rs 447 crore in 2000-01. Importantly, the drop in exports has been after a massive increase in exports during 2000-01 as against Rs 235 crore in 1999-2000.

On the production front, spinning machinery which accounts for over 45 per cent of the total domestic machinery production, saw a fall of 21.99 at Rs 486.22 crore. After a huge leap of 114 per cent at Rs 272.46 crore in 1997-98, production of synthetic fibre machinery has been falling in the last four years. The production in 2001-02 stood at mere Rs 54.59 crore. In the weaving machinery segment, production could not sustain the growth of 65 per cent achieved in 2000-01 and declined 34 per cent to Rs 7848 crore in 2001-02. Production of processing machinery has almost been stagnant in the last five years. Hosiery machinery has provided some kind of relief to the industry. Textile spares and accessories is the one area where the industry should enhance its exposure not only for domestic but also for the international market. Along with product development, the industry needs to explore newer markets. All this will call for a comprehensive action plan.