Reliance Weaving Mills Chairman's Message
The prominent share of the textile industry in the economy along with its contribution to exports, employment, foreign exchange earnings, investment and value addition makes it the single largest manufacturing sector for Pakistan.
Global Market Overview
The Pakistan textile sector contributes more than 60% to the country's total exports. The industry contributes around 46% to the total output produced in the country. In Asia, Pakistan is the 8th largest exporter of textile products.
The prices of cotton have touched all time high and the main reasons for this increase are:
- 2010 flash floods in Pakistan that destroyed or damaged the local cotton crop.
- Ban on export of cotton by the Indian government.
- Transformation of Brazil into a cotton importer.
- Disturbed cotton production in China.
Based on these factors, the future prospects remain unclear. However, the price of local cotton will remain low as compared to imported, provided the domestic yield targets are achieved.
The world demand for textiles is rising at around 2.5%, due to which there is opportunity for rise in exports from Pakistan.
National Installed Capacity
The textile industry of Pakistan has a total installed spinning capacity of 1,550 million kg of yarn, weaving capacity of 4,368 million square meters of fabric and finishing capacity of 4,000 million square meters. The industry has a production capacity of 670 million units of garments, 400 million units of knitwear and 53 million kg of towels.
The industry has a total of 1,221 units engaged in ginning and 442 units engaged in spinning. There are around 124 large and 425 small units that undertake weaving. There are around 20,600 power looms in operation in the country. The industry also houses around 10 large and 625 small finishing units.
Company's Operational Review
The higher domestic and export demand of yarn has led to growing sales revenue in recent years. This is backed by the purchase of cotton at competitive prices resulting in profits for the company's spinning units. Weaving profit in 2010 was also satisfactory, though lower from previous year because of high price of yarn.
The cost of labor, gas and electricity has increased substantially and is expected to rise further in future. The Company has therefore initiated cost efficiency and energy saving efforts with a focus on increasing productivity.
Future Prospects
Reliance Weaving Mills Limited exercised BMR and enhanced its weaving production capacity by installing 72 Tsudakoma looms with back process. Out of these, 48 looms have started commercial production and the remaining 24 are expected to start production soon. This will further enhance the efficiency and productivity of the weaving unit.
Acknowledgements
The Board of Directors wish to place on record their appreciation for the assistance, guidance and cooperation that Reliance Weaving Mills Limited received from all stakeholder including the Government of Pakistan, Financial Institutions, Commercial Banks, Customers and all others whose continued support has been a source of strength to the Company. The Directors also sincerely appreciate the devotion and commitment of every employee of the Company.
Fawad Ahmed Mukhtar
Chairman
Reliance Weaving Mills Limited
