Interview with Jindal Worldwide Limited

Interview with Jindal Worldwide Limited

by 5paisa Research Team Last Updated: 2022-06-20T18:07:06+05:30

Customer centricity, value maximization for shareholders and expansion of global footprints are the top three strategic priorities for us, affirms Gaurav Davda, Head-Corporate Finance & Strategic Initiatives, Jindal Worldwide Ltd.

What is your outlook on the Indian textile and apparel industry?

The textile and apparel industry has entered the sweet spot after a long gap. The shift in demand seen domestically and globally due to wardrobe changes, fast fashion approach and hybrid work culture has given a new life to the industry. The players who have survived the long 6-7 years of low-margin business, are now in a better position to leverage the rise in demand and are capitalizing on the same through suitable expansion plans. We think the textile and apparel industry has entered its bullish phase which is likely to be around for at least 4 to 5 years. China has been contributing lower to the global supply chain and hence we as India are poised to grab some market share from them which will hold us in good stead.

How Jindal Worldwide is uniquely positioned to make the most of the emerging opportunities in the sector?

Textile is the cyclical sector and being in the industry for so long, we have understood the rules of the game. The same is also applicable to the denim industry. Historically, we have been growing 2x the industry average over the last many years. Earlier, the range of denim that we used to offer was not broad and we realized that if we broaden the range of products that we offer to our customers in terms of category we have a good chance of not only increasing our margins but also growing the top line more sustainably since our dependence would not be limited to few products only.

From 2016 to 2018, we invested in technology & capex and worked to improve our operational efficiency. Due to a downturn in the economy at the same time when we did our capex, our margins did take a beating during those years, but we were confident of leveraging the capex when the cycle reversed. As expected, the cycle reversed as the hybrid work culture and fast fashion behaviour of people bought back the denim in the picture again.

Can you shed some light on how the rising environmental concerns among consumers is creating new opportunity in the market for recycled denim?

There is this whole new world of products emerging from recycled denim and the new generation of customers are loving it since they are more environmentally conscious. With consumers now checking for the environmental damage caused by the products they are using, even the organized sector players are ensuring they use environment-friendly denim fabrics wherever possible and have a waste management policy in place for minimal waste generation. Consumers now prefer to explore the entire chain of denim products being manufactured to check on the sustainability of the product and big firms, wherever possible, now are open to providing this information to their consumers.

We at Jindal Worldwide Ltd are working towards being planet positive in the near future and have made many efforts on the water discharge, renewable power and waste treatment fronts and our efforts have been recognized in many forums.

What are your top 3 strategic priorities?

Customer centricity, value maximization for shareholders and expansion of global footprints are the top 3 strategic priorities for us as of now. We are focusing on backward integration for the first two priorities. With capex being done in back-end spinning capacity, we are focusing on increasing our EBITDA margins over the next few years to take it to the mid-teens.

Also, with innovation and building excellence in our set of products, we are today offering the widest possible range of denim to our customers, to ensure that no customer needs are ignored due to the inability to provide the wanted products. We also want to expand our global footprints as demand for denim grows globally. With set capacity in hand, we would be able to increase our export contribution of overall revenue to 40% from the current 25% in the next three years.


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