Indonesia Textile & Garment Industry Report - 2015

Indonesia Textile & Garment Industry Report - 2015

This report profiles Indonesia’s textile and garment industry, discussing market trends through 2014 and outlook for 2015 and beyond. The report also highlights leading players in the sector including PT Pan Brothers Tex Tbk, PT Eratex Djaja Tbk and PT Ever Shine Tex Tbk.

The textile and garment industry is an important contributor to Indonesia’s economy, serving as a large source for jobs and export earnings. Being one of the largest textiles and apparel producers in the region, the country has a long tradition of producing and exporting ready-made garment and home- fashion textiles. Primary production areas of domestic textile and textile products are located in West Java province. Currently, Indonesia’s textile industry accounts for about 2% share of the global market.

In recent years, the consumption of synthetic household textile and furnishings has been on an upward growth trend. The sector relied on natural fibers traditionally, but consumption of synthetic fibers production in household textiles and furnishings has increased, owing to their inherent environmental, performance, and health advantages. Industry observers predict this trend towards synthetic fibers and away from natural fibers, by expanding markets in developing economies, is set to continue.

The current global economic condition has adversely impacted the upstream fiber industry. With plummeting consumer confidence amid global slowdown, demand for apparel and textiles has declined, affecting the demand for fibers used in their manufacture. The upstream sector has taken a bigger hit due to growth of imports from other countries.

Nonetheless, Indonesian textile exports accounted for only 2% share of the global market. Therefore, there is a huge opportunity for the textile industry to expand and capture a larger market share globally. Major challenges facing the industry include soaring global prices of raw material, raw material declining supply, and global climate change. Some of the initiatives undertaken by the Ministry of Industry to boost investment include exempting import duties on raw materials and machine imports over a two-year period.

Key Points:

The export value of textiles and textile articles reached USD 13.1bn in 2014, up slightly by 0.6% y/y.

The general overall industrial production index grew by 4.8% y/y in FY14, lower than the FY13 figure. The production index for garments sector grew at a moderate 3.6% y/y in FY14, after growing by 8.4% y/y in FY13.

Indonesia had an average GDP growth rate of 5.9% during 2006-2011. In FY13, GDP grew by 5.8%, which was better than that of developed markets and even some emerging economies. However, FY14 proved to be a tough year for the economy with GDP slowing to a five-year low of 5%. Textile and apparel sector also bore the brunt of this slowdown with subdued growth during the last few quarters.

1. Industry Profile
1.1 Sector overview
1.2 Sector size
1.3 Competitive landscape
1.4 Environmental scanning

2. Market Trends and Outlook
2.1 Key economic indicators-Indonesia
2.2 Textile trade
2.3 Prices
2.4 Market outlook

3. Leading Players and Comparative Matrix
3.1 Leading players
3.1.1 PT Pan Brothers Tex Tbk (Pan Brothers)
3.1.2 PT Eratex Djaja Tbk (Eratex)
3.1.3 PT Ever Shine Tex Tbk (Ever Shine)
3.2 Comparative matrix
3.3 SWOT analysis

4. Tables and Charts
Table 1: Structure of Indonesian textile and garment industry
Table 2: Framework of textile and textile products industry development
Table 3: Key financial ratios of leading players

Chart 1: GDP contribution by textile and garments industry
Chart 2: Segment share in terms of value of production output
Chart 3: Export earnings from textile sector
Chart 4: World’s largest textile export markets
Chart 5: Projected investment in textile, leather and footwear industry
Chart 6: Position of People's Representative Council after 2014 Elections
Chart 7: GNI per capita, Atlas method
Chart 8: Quarterly GDP growth rate-Indonesia
Chart 9: Trade balance of Indonesia
Chart 10: Average monthly USD to IDR exchange rate
Chart 11: Government budget deficit
Chart 12: CPI Inflation-Indonesia
Chart 13: BI rate-Indonesia
Chart 14: Y/Y change in industrial production index-Textiles
Chart 15: Y/Y change in industrial production index-Garments
Chart 16: Exports by segments
Chart 17: Imports in the textile and garments sector
Chart 18: Producer price index for textile spinning and weaving
Chart 19: Producer price index for garments
Chart 20: Net export sales by geographical region
Chart 21: Net sales of Pan Brothers
Chart 22: Profit margins of Pan Brothers
Chart 23: Net export sales by geographical region
Chart 24: Net sales of Eratex
Chart 25: Profit margins of Eratex
Chart 26: Net export sales by geographical region
Chart 27: Net sales of Ever Shine

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