>Textile sector outlook(CLSA)

Our meetings with textile and apparel majors and outsourcing arms of US
retailers indicates that outsourcing out of India is still on the increase
even as US retailers are brutally hurt. India is seeing incremental benefit
as growth in China slows, cost pressures in China increase and Pakistan
remains embroiled in social strife and tension. However, over the last 12
months, vendor consolidation has accelerated and even as larger vendors
gain market share, smaller ones are losing out. The outlook for 2009 is
very challenging given cost pressures and lower growth than the last five
years. We expect both prices and volumes to be under pressure in 2009.
While textile sector has underperformed, there is no reason to merit
investment given the medium term outlook.

To read full report Textile sector outlook(CLSA)