Textile companies in Ludhiana are now focusing only on core business to survive the downturn. These units had branched out into non-core operations during boom to bolster revenues.
But, the slowdown has pushed textile exporters in the region into the red. Traders anticipate exports from Ludhiana to decline to Rs 800 crore in financial year 2008-09, as compared with Rs 1,100 crore in the previous fiscal.
The falling business in the export market has now forced many region-based textile companies to focus more on core operations by closing down the non-core businesses, said industry sources.
For instance, a textile firm here with interest in yarn and knitwear manufacturing is planning to divest one of its manufacturing unit located in Europe and utilise the money realised through its sales for core operations.
Similarly, another Ludhiana-based textile company, which is into yarn, terry towels and carpet manufacturing, plans to offload its non-profitable terry towels business.
Many who have expanded rapidly into retail too plan to consolidate their business.
Ludhiana Knitters' Association president Ajit Lakra said the current global conditions had made survival a critical issue for most of the textile companies here.
British accountancy firm Grant Thornton director Paras Arora has also suggested that the textile companies in the region focus on synergising their existing operations and divest ineffectual units.
