Low Demand and Rising Working Capital
Over the last six months, demand for tiles has been low in domestic as well as export markets. A rise in input costs, especially natural gas, and low working capital for a prolonged period are among the primary reasons for the production holiday.
Prices for tiles and ceramic products are expected to soften or remain static in the near term, as weakness in exports is leading to volumes shifting to the domestic market. Meanwhile, the domestic market industry is seeing softness in retail volumes, and in Morbi, there is an increase in working capital due to rising inventory to 90-120 days from 75 days.
Bumper Exports of Ceramics in 2021-22
India’s exports of ceramics & glassware products for 2021-22 hit a record at US$ 3.464 billion. During the financial year 2013-14, India’s ceramic & glassware products exports were valued at US$ 1.292 billion. This is a growth of 168% over the eight-year period.