The reduced purchasing power in key export markets, like the US, due to recession is expected to weigh on the order book of Indian exporters, and could in turn hamper the near-term earnings for the textile companies.
The beleaguered textile sector in Pakistan is grasping at straws seeking policy supports from the prime minister. The move has got experts hot and bothered about the scenario in India as well.
In its submission to the prime minister, the Pakistan Textile Mills Association has stated that international demand has weakened with the clouds of a worldwide recession looming close and, without price competitiveness, it is not possible for the industry to retain its market share.
Textile stocks have run up significantly in the past two years but ICICI Securities believes the current headwinds could, in the near term, outweigh the long-term structural story of the sector.
Source: Money Control