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Ahmedabad: Rapidly grow­ing gar­ment hub

With mul­ti­ple crowns to add to its glory like the tex­tile state of In­dia, the denim cap­i­tal of In­dia, Gu­jarat, at present has a tex­tile mar­ket of around US $ 25 bil­lion and con­trib­utes nearly 12 per cent to In­dia’s tex­tile ex­ports...

With mul­ti­ple crowns to add to its glory like the tex­tile state of In­dia, the denim cap­i­tal of In­dia, Gu­jarat, at present, has a tex­tile mar­ket of around US $ 25 bil­lion and con­trib­utes nearly 12 per cent to In­dia’s tex­tile ex­ports.

The list is quite long and im­pres­sive as Gu­jarat cov­ers the en­tire sup­ply chain right from cot­ton pro­duc­tion to tex­tile ma­chin­ery. And now, Ahmedabad, one of the big­gest tex­tile hub and the largest city of Gu­jarat, is grow­ing as a gar­ment­ing hub. The com­pa­nies based here, and work­ing in an or­ga­nized way, are in the process of huge ex­pan­sion for gar­ments, while some of them are tak­ing the IPO route. There are emerg­ing gar­ment man­u­fac­tur­ers purely fo­cus­ing on the do­mes­tic mar­ket but hav­ing state-of-the-art manufacturing units. Some of them are also hav­ing ex­pert tech­ni­cal con­sul­tants work­ing with them. The ver­ti­cal in­te­grated com­pa­nies are al­ready go­ing strong in gar­ment­ing, and are fur­ther di­ver­si­fy­ing and adding new prod­uct cat­e­gories, ex­pand­ing both into ex­port as well as do­mes­tic mar­ket. Team Ap­parel On­line vis­ited these com­pa­nies to un­der­stand their growth strat­egy in this boom­ing gar­ment­ing sce­nario.

In tex­tile seg­ment for last six decades, CA Pa­tel Tex­tiles, en­tered into ca­sual and semi-ca­sual shirt manufacturing just six months be­fore for its own brand ‘ITALFIC’ with 200 stitch­ing ma­chines. It fur­ther plans to in­stall 800 stitch­ing ma­chines in the next two years. Manufacturing mil­lions of gar­ments per month, of­fer­ing an en­tire range of fash­ion gar­ments, Ko­mal Tex­fab is now di­ver­si­fy­ing into jeans and eth­nic wear manufacturing with an in­vest­ment of nearly Rs. 50 crore. It is also go­ing to dou­ble its cir­cu­lar knit­ting ca­pac­ity which is cur­rently 200 tonnes per month. Globe Tex­tiles In­dia Ltd., manufacturing 2 lakh jeans (ma­jorly ba­sic as well as semi-fash­ion­able) for the In­dian and the over­seas mar­ket, is also in­creas­ing its stitch­ing ca­pac­ity. Kolkata based brand, Ap­pleEye re­cently tied up for 25,000 gar­ments per month with one such Ahmedabad-based com­pany. Two years old, Bub­ble Bee Ex­port House, which had seen 200 per cent growth last year, is in the process to in­stall 250 stitch­ing ma­chines. These are am­ple ex­am­ples which prove Ahmedabad’s strength in gar­ment­ing.

There is no doubt that Gu­jarat, or even Ahmedabad, has a strong avail­abil­ity of cot­ton fab­ric since a long time, rea­son­ably good labour avail­abil­ity,

State Gov­ern­ment sup­port which mo­ti­vates en­trepreneurs to move for­ward. Al­ready go­ing strong in pro­cess­ing and manufacturing of home fur­nish­ing prod­ucts, ap­parel is the only seg­ment which was not ex­plored in Ahmedabad, and hence com­pa­nies in this city are nat­u­rally mov­ing to­wards this. Pro­cess­ing/print­ing, yet an­other strength of Ahmedabad, is also one of the rea­sons for knit­ted gar­ments’ growth here. “Gar­ment­ing was al­ready here in Ahmedabad but it was ma­jorly for the do­mes­tic mar­ket and the un­or­ga­nized mar­ket. How­ever, since last few years, it is grow­ing in an or­ga­nized way be­cause only gar­ment­ing is left to be ven­tured fur­ther. We have every­thing re­quired for sup­port struc­ture, right from yarn to fin­ish­ing in sur­round­ing ar­eas, so

gar­ment­ing was a nat­u­ral op­tion for com­pa­nies like us. Fur­ther grow­ing do­mes­tic mar­ket with or­ga­nized re­tail is also at­tract­ing top com­pa­nies to come up in gar­ment­ing. All chain stores or re­tail giants are al­ready as­so­ci­ated with this hub, so there is as such no chal­lenge for us in gar­ment­ing,” states Suresh P. Ba­grecha, CMD, Ko­mal Tex­fab. He fur­ther added that there are hardly any top ex­porters across In­dia who do not take fab­rics/print­ing sup­port from Ahmedabad, so they tend to have a fair idea about the fab­ric re­quired for ex­port.

Ko­mal Tex­fab Group that started in 1981, en­tered into gar­ment­ing in 2008 and now has two units. The com­pany is strong, both in ex­port and do­mes­tic mar­ket with re­gard to gar­ment­ing. Cur­rently, it is hav­ing an or­der of Rs. 60 crore from the do­mes­tic mar­ket. Hav­ing a to­tal turnover of

Rs. 200 crore in the last fis­cal, the com­pany is ex­pect­ing more than Rs. 250 crore in the cur­rent fis­cal. Ap­parel busi­ness con­sti­tutes 50 per cent of the com­pany’s turnover.

Even Swapnil Pa­tel, Di­rec­tor,

CA Pa­tel Tex­tiles, shared, “We al­ready have strength in cot­ton fab­ric, which is 60 per cent cost of the gar­ment. This strength mo­ti­vated us to start shirts manufacturing. Other ap­parel hubs are sourc­ing fab­ric from this city and grow­ing well, so why can’t we? Our ex­ist­ing strong re­tail net­work is sup­port­ing us in mar­ket­ing which en­ables us to have more mar­gin with less ef­forts and less in­vest­ment in gar­ment­ing. Our fo­cus for ex­pan­sion will be gar­ment­ing pri­mar­ily as we will start tees, trousers, etc. The gar­ment man­u­fac­tur­ers to whom we sup­ply fab­rics across In­dia are will­ing to start units here.” He fur­ther added that good busi­ness en­vi­ron­ment, proper in­fra­struc­ture like enough elec­tric­ity is an­other mo­ti­va­tion for the com­pany to start gar­ment­ing. At present, CA Pa­tel Tex­tiles is hav­ing an an­nual busi­ness of Rs. 300 crore and is ex­pect­ing growth of at least 30 per cent.

AOI also got a chance to have more in­for­ma­tion on this ris­ing gar­ment­ing busi­ness from Bhavin Parikh, CEO, Globe Tex­tiles In­dia Ltd. who briefed: “In the last few years, tex­tile busi­ness has strength­ened across In­dia. In Ahmedabad, the fo­cus has shifted to­wards ap­parel. The ca­pac­i­ties have al­ready been en­hanced at the fab­ric level and now we want to cover the en­tire value chain, so things are in mo­tion. We are also get­ting lot of sup­port from State as well as Cen­tral Gov­ern­ment for the same.” He in­formed that his com­pany has four ver­ti­cals, namely ap­parel, printed fab­rics, denim fab­rics and re­cently it started home fur­nish­ing also which is nearly 5 to 10 per cent of its to­tal busi­ness. Its ap­parel do­main started in 2006 and is now 35 to 40 per cent of the en­tire busi­ness of the com­pany. In the last fis­cal, it had a turnover of Rs. 190 crore and it is ex­pect­ing 15 per cent growth this year and 25 to 30 per cent in the next few years.

SMOOTH LABOUR HAN­DLING

It is easy to man­age labour in Ahmedabad as there are no union is­sues which makes work­ing smooth. But labour­ers here have an en­tre­pre­neur mind­set and af­ter few years of ex­pe­ri­ence and re­sources, some of them start their own job­work or sim­i­lar kind of busi­ness at a small level. But com­pa­nies are man­ag­ing it ef­fec­tively, like CA Pa­tel Tex­tiles which is giv­ing in­cen­tives to the work­ers, and that too de­spite piece rate, is also train­ing op­er­a­tors to in­crease pro­duc­tiv­ity and keeps mo­ti­vat­ing them. It even runs pro­grammes in nearby vil­lages to bring labour to the fac­tory apart from of­fer­ing them liv­ing space at dis­counted rates, trans­porta­tion, etc.

More than 60 per cent of the work strength of Globe Tex­tiles have been as­so­ci­ated with it for more than a decade. “We put in a lot of ef­forts to re­tain the op­er­a­tors and give them the best work­ing en­vi­ron­ment. We hire fresh­ers too and give them proper train­ing. We pre­fer to work from the bot­tom to the top,” stated a proud Bhavin. He even con­firmed that the com­pany has very less ab­sen­teeism which helps to solve the cost issue.

GAR­MENT­ING IN-HOUSE

The na­ture of tex­tile busi­ness in Ahmedabad is ma­jorly out­sourc­ing as very few play­ers are ver­ti­cally in­te­grated, but the good thing is that in gar­ment­ing, they have most of the pro­cesses in-house be it cut­ting, prod­uct de­vel­op­ment, stitch­ing or fin­ish­ing. “With re­gard to fab­ric, we are cost-ef­fec­tive com­pared to big mills as they have their over­heads com­pared to our weavers and process houses. Our strong net­work, vast ex­pe­ri­ence, quite open sourc­ing, bulk pur­chas­ing power help us in man­ag­ing costs,”

Spread in 38 hectares, Ahmedabad Ap­parel Park, GIDC, has proved to be a big sup­port for the gar­ment­ing units of the city. Apart from strong in­fra­struc­ture, the labour avail­abil­ity is com­par­a­tively easy in this lo­ca­tion. Ko­mal Tex­fab and Globe Tex­tiles In­dia Ltd. also have their units here.

rea­soned Swapnil. The com­pany sources 30 to 35 lakh me­tres of fab­ric per month. He fur­ther added that rather than fo­cus­ing on back­ward in­te­gra­tion and in­vest­ing more, it is bet­ter to fo­cus on mar­ket­ing and the for­ward side which is gar­ment­ing. But Suresh strongly insists that their ver­ti­cal sys­tem sup­ports in re­duc­tion of costs and quick de­liv­er­ies.

IN­CLU­SION OF OR­GA­NIZED RE­TAIL­ERS, FOR EX­PORTS AND OWN BRANDS

In Ahmedabad, play­ers like CA Pa­tel Tex­tiles are fo­cus­ing on do­mes­tic mar­ket and want to de­velop their brands for bet­ter mar­gin rather than go­ing for con­tract manufacturing in ex­port. Even manufacturing for or­ga­nized do­mes­tic re­tail giants is not their pri­or­ity. Com­pli­ca­tion of ex­ports is an­other rea­son for this shift in thought. While Ko­mal Tex­fab is strong in ex­ports as well as do­mes­tic, Global Tex­tiles is work­ing for Land­mark Group in In­dia as well as Dubai, along with other over­seas buy­ers. Many more small- and medium-level com­pa­nies are ac­tively ex­port­ing gar­ments.

TRAN­SIT TO POLYESTER IS NOT ES­SEN­TIAL

Be it knits or wo­ven, most of the com­pa­nies do­ing gar­ment­ing in Ahmedabad are ma­jorly into cot­ton­based gar­ments and they have no in­ter­est or plan to fo­cus on polyester­based or blended gar­ments. Will it not make them lose the growth hap­pen­ing in this seg­ment as it is de­vel­op­ing fast? Lo­cal in­dus­try does not think so. Suresh jus­ti­fies such a stand say­ing, “Com­pa­nies like ours are al­ready full with or­ders of cot­ton-based fab­ric and gar­ments, we don’t have even time to think about polyester. Su­rat is al­ready strong in polyester and there is no need for Ahmedabad to di­vert in sim­i­lar direction.”

WHAT NEEDS TO BE DONE MORE…?

In­dus­try ac­cepts that bring­ing over­seas buy­ers to Ahmedabad is com­par­a­tively dif­fi­cult, but events like Tex­tiles In­dia will be def­i­nitely help­ful in this re­gard. For fab­ric, al­ready a chunk of over­seas buy­ers keep com­ing to the city. Com­pa­nies have un­der­stood that at this level, they need to put ex­tra fuel to go over­seas and meet buy­ers. “We have to think of get­ting buy­ing houses of Delhi-NCR and Ban­ga­lore to visit Ahmedabad fre­quently as it is very im­por­tant to grow in ex­port,” adds Suresh. He stresses that bet­ter price and im­proved ser­vice can also be so­lu­tions in this as­pect. Suresh him­self is very much keen about R&D. Most of the ap­parel ex­port from Ahmedabad is into Mid­dle East coun­tries rather than US, EU or other coun­tries.

One of the rea­sons for this is that Ahmedabad is not quite vi­able since com­pet­i­tive ex­port­ing coun­tries have duty ad­van­tages in US and EU. But lo­cal ex­porters feel that with the grow­ing ap­parel manufacturing ca­pac­i­ties, more and more com­pa­nies of Ahmedabad will also be able to cater to bulk buy­ers. It can be taken as a pos­i­tive in­di­ca­tion that some en­trepreneurs ac­cepted and in­sisted that the city needs to change its mind set, skill set for ex­port specif­i­cally, only then it will be able to chal­lenge other es­tab­lished ap­parel ex­port­ing hubs in In­dia.

Suresh P. Ba­grecha, CMD, Ko­mal Tex­fab

Yash Pa­tel (L), Di­rec­tor, Shirt­ing Fab­ric & Gar­ment Di­vi­sion with Swapnil Pa­tel, Di­rec­tor from CA Pa­tel Tex­tiles

Prashanta Ku­mar (R), Gar­ment Di­vi­sion head, CA Pa­tel Tex­tiles claims that only his or­ga­ni­za­tion is us­ing ad­vanced sleeve placket press­ing ma­chine of Ngai Shing in Ahmedabad. The com­pany plans to fur­ther in­vest in Tukat­ech CAD

Bhavin Parikh, CEO, Globe Tex­tiles In­dia Ltd.

Jeans man­u­fac­tured by Globe Tex­tiles In­dia Ltd.

Im­pres­sive shopfloor of Globe Tex­tiles In­dia Ltd.

Strong Ap­parel Man­u­fac­tur­ers in Ahmedabad

• Arvind Mills • Ashima Group • Ko­mal Tex­fab • CA Pa­tel Tex­tiles • Ar­tex Ap­par­els • Aura Herbal

Tex­tiles

• Sun­star Ap­par­els • Ra­jka Design

Ca­sual shirts by CA Pa­tel Tex­tiles, ‘ITALFIC’ brand

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