India’s footwear exports may touch $3.37 billion in the next two years

The domestic footwear industry, the second-largest in the world after China, is growing at a rate of about 10% annually

With global economies recovering from the slowdown, India’s footwear exports are expected to more than double to $3.37 billion (about Rs14, 828 crore) in the next two years.

The Indian footwear industry, the second-largest in the world after China, is growing at a rate of about 10% annually, president of the Indian Footwear Components Manufacturers Association BD Bhaiya told reporters.

“Apart from the growth in the domestic sector, we have also set a target of $3.37 billion in exports of footwear alone by 2013-14,” Mr Bhaiya said.

In 2008-09, footwear exports from India were $1.53 billion. Of the total exports of leather and leather products, the segment contributes over 40%.

Several international brands like Nike, Adidas and Reebok source footwear from the $5-billion domestic industry.

India currently produces about 2.06 billion pairs of shoes in different categories. Per capita consumption of footwear in the country has also increased to two pairs from a mere 0.5 pairs a decade ago.

“With the quality and price competitiveness that has been proved, I am confident that India will fast become a major player in the global footwear market, as more and more companies are shifting their sourcing needs as well as production bases towards us,” Mr Bhaiya said.

The country’s major export markets are the US and Europe. India allows 100% foreign direct investment in the sector.

Companies like Formas Kunz (Brazil), Feng Tay Enterprises (Taiwan) and Apache Footwear (China) have set up production basis in India, Mr Bhaiya said.

The industry is organising a three-day Footwear, Materials, Manufacturing and Technology Fair in Greater Noida from 7th May to attract global players.
 

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COMMENTS

Shadi Katyal

7 years ago

It is nice to hear such progress but one is sad to read that almost all the progress is with FDI and nothing from our own bankers and industrialist.
India does not have enough talent and thus foreign companies as far as Brazil are sourcing in India. while one finds sandals and chapals made in Brazil all over the world. We have not seen any such products in USA or Europe.
what is the total export of footwear to Russia as she was at one time the biggest buyer.

QIBs and NIIs shy away from fundamentally poor & overpriced IPOs

The recent IPOs of Tara Health Foods and Tarapur Transformers have failed to woo QIBs and NIIs

Qualified Institutional Buyers (QIBs) and Non-institutional Investors (NIIs) have preferred to stay away from the recently-opened low-profile initial public offerings (IPOs). Tara Health Foods Limited (THFL) which opened for subscription on 28 April 2010 has received an overall subscription of zero on day one. The issue closes on 30 April 2010. QIBs and NIIs have completely avoided the IPO which saw zero subscription out of 35 lakh and 15 lakh shares reserved under their respective quotas. The company has 85 lakh shares on offer. The issue is priced at a whopping price band of Rs180-Rs190 per share while the company has posted a net profit of just Rs16.99 crore in the year ended March 2009. The fate was similar in the retail investor category which saw 0.0047 times subscription. Fitch has assigned‘IPO Grade 2’ to THFL which indicates ‘below average’ fundamentals.

Similarly, retail investors have given a thumbs-down to the two IPOs of Nitesh Estates Ltd and Mandhana Industries Ltd which hit the market this week.
Mandhana Industries Ltd, which opened on 27 April 2010, received 0.19 times subscription from retail investors on day two. The company has set a price band of Rs120-Rs130 per share. The issue closes today. CRISIL has assigned an ‘IPO Grade 3’ to Mandhana Industries indicating ‘average’ fundamentals. Nitesh Estates Ltd, which closed on 27 April 2010, has received a subdued 0.22 times subscription from NIIs and 0.16 times the subscription in the retail investor category. Overall, the issue has been subscribed 1.27 times out of the 6.41 crore shares on offer. The issue has been rated ‘IPO Grade 2’ by ratings agency CRISIL which implies ‘below average’ fundamentals. The price band was Rs54-Rs56. Its profit after tax (PAT) was Rs2.85 crore for the year ended March 2009.

Even Mandhana Industries Ltd’s IPO which closes on 29 April 2010 has received 0.19 times subscription on the second day from the retail investor category. Meanwhile, Tarapur Transformers Ltd, which closed yesterday, has managed to get just 0.03 times subscription on the last day from QIBs. It recorded a PAT of Rs2.15 crore in FY09. The issue closed on 28 April 2010.

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COMMENTS

Manoj

7 years ago

What is the role of SEBI in such cases? If they act as rubber stamp for whatever documents are placed before them for approval, what is the sanctity of such approvals?

AJ

7 years ago

There should be a minimum eligibility criteria of ratings vs. pricing for companies to list ... rather than allowing all and sundry to list at prices that are out of this world

Financial castles in the air-IV

Builders are offering ‘guaranteed’ returns—and rebates— to homebuyers in return for upfront payments even for under-construction properties. This is the fourth part of a continuing series

Anand Bhakitiani Group, a small developer in Chandivali near Powai in Mumbai, is offering an assured return scheme for investment in a property that the group is developing, called ‘Shiv Shrishti’. According to market sources, the (planned 15-storeyed) project was initiated four years back, but due to lack of finance, it is still incomplete. The developer has been able to construct the tower only till the third floor (ground plus two floors) till now.

According to the scheme, the buyer has to book an apartment paying 50% down payment and he can exit the scheme after 15 months (which is the lock-in period) with a profit of Rs1,200 per sq ft, if he decides to sell the flat back to the developer. Currently, the apartments—two bedroom hall & kitchen (BHK) of 1,000 sq ft; three BHK of 1,750 sq ft and four BHK of 2,100 sq ft—are being offered at Rs8,000 per sq ft (plus Rs20/sq ft floor rise premium).

A two BHK costs Rs80 lakh, out of which Rs40 lakh has to be paid during booking the property and the remaining amount can be paid within a year’s time. Moneylife spoke to a broker who is selling these apartments who guaranteed us that it was his responsibility to sell the apartment at Rs9,200 per sq ft after 15 months and hand over the profit to us. He also said that there is no transfer fee required to be paid during the exit for transferring the ownership of the apartments.

The surprising factor is that the broker also suggested that the investors should not waste their money on stamp-duty and registration. The broker is providing an ‘allotment certificate’ on a Rs-100 stamp paper as proof of the buyer’s ownership.

According to the broker, the allotment certificate contains a “strict clause” so that the developer cannot cheat the buyer.

(This is the fourth part of a continuing series)

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