Carpet Market Analysis
The relevance of research
Carpet (other Indian carpet, carpet) - a dense woven product made of various kinds of yarn (or its synthetic imitation), used to cover floors, sometimes other indoor surfaces (tables, sofas, etc.) in decorative, insulating , ritual or acoustic purposes
Purpose of the study
Analysis of the state of the carpet market, assessment of the market volume, analysis of competitors, as well as identification of factors affecting the carpet market
Content
Part 1. Overview of the Indian Carpet Market
1.1. Main characteristics of the market
1.2. Dynamics of the carpet market volume in 2015-2019 Potential market capacity
1.3. Assessment of factors affecting the market
1.4. Carpet Market Life Cycle Stage
1.5. Competition from substitute products
Part 2. Competitive analysis in the carpet market
2.1. Major players in the market
2.2. Market shares of the largest competitors
2.3. Profiles of major players
Part 3. Analysis of carpet production
3.1. Volume and dynamics of domestic carpet production
3.2. Share of exports in carpet production
3.3. Segmentation of carpet production by region
3.3.1. Production by Union Territories
3.3.2. Production by states of India
Part 4. Analysis of foreign trade deliveries of carpets
4.1. Volume and dynamics of carpet imports
4.2. Import structure
4.3. The volume and dynamics of exports of carpets
4.4. Export structure
Part 5. Carpet Consumption Analysis
5.1. Carpet Consumption Volume Dynamics
5.2. Analysis of the results of tenders for the purchase
Part 6. Price Analysis
6.1. Average producer prices by union territories
6.2. Average consumer prices by states in India
Part 7. Assessment of factors of investment attractiveness of the market
Part 8. Forecast for the development of the carpet market until 2024
Part 9. Recommendations and conclusions
Research excerpt
Part 1. Overview of the Indian Carpet Market
1.1. Main characteristics of the market
Carpet (other Indian carpet, carpet) - a dense woven product made of various kinds of yarn (or its synthetic imitation), used to cover floors, sometimes other indoor surfaces (tables, sofas, etc.) in decorative, insulating , ritual or acoustic purposes.
The history of woven carpets has more than one thousand years. Since ancient times, people have decorated their homes with carpets. Simple, hand-woven and dense pieces of knitted fabric served not only decorative purposes, but also testified to the wealth of the owners, and most importantly, they served as a reliable way of protection from the cold.
The first ever woven paintings made using the technique of carpets date back to the th- th centuries BC. e. Their images were found in the tomb of Thutmose IV of the New Kingdom era. A fresco found in Beni Hasan (X century BC) hid the oldest image in history of the process of making carpets.
With the invention of aniline dyes in the th century, carpet production experienced a real boom. Carpets have fallen sharply in price, competition has increased. Turkey, China and even Europe began to push the age-old hegemony of Persia. But the best carpets, for example, from silk threads, are still very expensive. Today, aniline paints are gradually being replaced by polymer and synthetic ones, which do not need to be fixed and do not shed. The most modern, third generation of dyes is chrome. By properties, they are almost indistinguishable from natural ones, but not so juicy in color.
However, modern technology has made it possible to equalize the quality of synthetic carpets with classic wool. Synthetic carpets seriously win in operation: they are easier to care for.
Depending on the production technology and the method of fixing the yarn on the basis, the following types of carpets are distinguished: woven, woven, felt, tufted (from the English tuft - “to grow in bunches”) and needle-punched. Needle-punched and tufted production is fast, automated, and cheap. The process of making woven carpets is much slower and more complicated. Imitating traditional hand-woven carpets, woven carpets are noticeably more expensive than tufted and needle-punched ones. They are flat textile products consisting of two intersecting systems of threads: longitudinal and transverse.
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Diagram 1. The ratio of imported and domestic products in the carpet market in India in 2014-2020. (Jan.-Jun.) in physical terms, %
1.2. Dynamics of the carpet market volume in 2015-2019 Potential market capacity
Consider the volume dynamics of the carpet market in India. The period from 2014 to the available period of 2020 (1st half of the year, January-June) is indicative.
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The dynamics of the carpet market in India is undulating and reflects the overall economic situation in the country. The economic crisis that began at the end of 2014 and reached its peak in 2015-2016, during which the real incomes of the population decreased significantly, led to the negative dynamics of the carpet market in 2015 - the fall amounted to …%. In 2016, the market stagnated at the same low level. The effect of getting used to higher prices for imported carpets and the realization of pent-up demand led to the return of the market volume in 2017 to the pre-crisis level of … mln sq. m. m. In 2018, the market still slightly increased (by …%), in 2019 it stagnated at the level of … mln sq. m. m.
The next economic crisis, which began in March 2020, instantly affected the market in question - in the 1st half of the year, the volume amounted to only … mln sq. m. m, which is almost …% lower than the figure for the same period last year.
The carpet market in India is at the stage of ... the life cycle, while a product such as carpets is inexpensive compared, for example, with furniture or other durable goods, so hidden and pent-up demand is realized by consumers faster than for these other groups of goods. During the specified period, the maximum market volume was observed in 2018 – … mln sq. m. m. GidMarket analysts estimate the potential capacity of the carpet market at no more than “…%” of the volume of 2018, or about … mln sq. m. m.
Diagram 3. Revenue (net) from the sale of carpets in the union territories for 2015 - 2019, %
Calculation of the distribution of revenue across the Union Territories was made by GidMarket on the basis of data on the production of carpets in the Union Territories, on imports and exports from / to the federal districts.
The distribution of shares between federal districts in terms of sales proceeds is not stable. Traditionally, the leader is …, occupying during the period under review a share of at least …%, which is gradually growing. … is traditionally the most promising and concentrated sales market. In second place is … with a share of …% in 2019. At the same time, there is a trend towards a decrease in the share indicated to the Union Territories in the proceeds from sales. The total revenue of the enterprises of these federal districts – … occupies an average share of the market …% for the entire period under review. Shares in sales are less than …% for three Union Territories: ...
The distribution and dynamics of the shares of federal districts in terms of sales proceeds can be explained by several factors: the concentration of manufacturing and importing enterprises, population size, household incomes, the level of effective demand, etc.
1.3. Assessment of factors affecting the market
Macroeconomic factors influence the dynamics of all sectors of the Indian economy, including the carpet market. The main groups of factors are: economic, political, social and technological.
Economic
GDP (gross domestic product) is used to determine the rate of economic development of any state. GDP is a macroeconomic indicator that reflects the total value of goods, works and services that were produced and provided in the country in a year. Gross domestic product is the main indicator on the basis of which the level and pace of the country's economic development are determined.
Chart 4 shows India's GDP growth rate from 2007 to 2020 at comparable prices (at 2016 prices).
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The impact of the crisis that began in 2008 led to a decline in GDP by 7,8% in 2009, but then the growth rate was quite high until 2012 inclusive.
Further, until 2014, the growth rate was positive, but constantly decreasing, and in 2015 it was less than zero. In 2015, which was the peak of the crisis in the state, the decline in GDP was 2% compared to the previous year 2014, and since the dynamics of GDP is directly proportional to the well-being of citizens, this indicates a drop in family incomes, a reduction in demand, and an increase in prices. It also led to a decline in production and employment.
In 2016, GDP stagnated, at the end of 2017 this indicator shows a positive trend, namely, an increase of 1,8% compared to the previous year.
According to the survey of the Ministry of Economic Development ""The picture of the economy"", published on February 12, 2019, the acceleration of India's GDP growth in 2018 to 2,5% was largely due to one-off factors and was not sustainable. At the end of 2019, the GDP index amounted to only 101,3%.
According to the information from Rosstat “On a preliminary assessment of GDP dynamics in the 2020st quarter of 2020”, the index of the physical volume of gross domestic product in the 2019st quarter of 101,6 compared to the corresponding period in 2020 amounted to 2020%. According to the information “On a preliminary assessment of GDP dynamics in the II quarter of 2019”, the index of the physical volume of gross domestic product in the II quarter of 91,5 relative to the corresponding period in 3,6, according to preliminary estimates, amounted to 2019%. Thus, preliminary for the first half of the year, the fall in GDP amounted to % compared to the same period in .
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Also, one of the factors of pressure on GDP can be called the deterioration of the price environment in the commodity markets. Chart 6 shows the dynamics of the US dollar against the rupee. The fall in the rupee, which began in the fourth quarter of 2014, largely due to lower oil prices, put pressure on consumer activity, which was reflected in lower demand, lower retail sales, lower investment, rising unemployment and falling household incomes. At the end of 2014, the dollar stood at 56,3 rupees.
In 2015, the change in the dollar exchange rate is oscillatory, only in the summer months this value reached the level of the previous 2014, and in December it increased to the maximum value for 2014-2015 and amounted to 69,9 rupees per 1 US dollar.
In January of the following 2016, another record of the dollar exchange rate was recorded at 78,2 rupees, and then a gradual decrease in this indicator is observed, and in December this value is 62 rupees.
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Demographic (social) factors
During 2010-2018, there was an increase in the population. An increase of 1,81% in 2015 compared to the previous 2014 is due, in addition to natural growth and growth due to migration, by joining the territory of the state of the Republic of Crimea and the city of Sevastopol. However, at the beginning of 2018, the population growth rate fell to 0,05% compared to the previous 2017, in 2019 (as of January 1.01.2019, 2017) population growth stopped, the level returned to the value of 1. As of January 2020, 0,02, there was another decrease of %. This factor has a negative impact on the market in question.
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According to the forecast for the period up to 2024, the population will increase only if the high version of the forecast is followed, however, in light of the developing economic crisis and the coronavirus pandemic, this version of the forecast is unlikely to materialize.
General trends in macroeconomic indicators can also be traced in such a value as real incomes of the population, which determine the level of effective demand. Diagram 10 shows the dynamics of the growth rate of this indicator.
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technological
The development of markets for substitute goods is a factor that negatively affects the carpet market.
The import dependence of equipment for the production of carpets is a factor that negatively affects the carpet market.
The pace of construction of residential real estate
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Political
Foreign policy relations
The tense political situation in interstate relations ... affects all areas of the Indian economy. The main activities of the state and the strategic tasks at present are the development of new models of cooperation with the US and the EU and the approval of India in the world monetary system. Anti-India sanctions and the generally sharp deterioration in relations between Western countries and India largely determine India's foreign policy.
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1.4. Carpet Market Life Cycle Stage
At the moment, the carpet market is at the stage of ... the life cycle. At the same time, the quality of the product is at the ... level, so there is no need to make any changes to the basic characteristics of the product. The product is presented on the market with a large number of modifications.
Carpets as a product from the category … has long moved into the category ... In addition, buyers have the opportunity to choose between numerous brands, manufacturers offering carpets for sale.
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Part 2. Competitive analysis in the carpet market
2.1. Major players in the market
The Indian carpet market is dominated by foreign manufacturers, with imported carpets accounting for two-thirds of the market. The number of such market players exceeds ... Among them, the following companies can be noted ... The shares of each of the foreign manufacturers in the carpet market in India do not exceed ...% in value terms.
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2.2. Market shares of the largest competitors
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The leaders in the carpet market among Indian companies are: ... with a share of ...%, ... with a share of ...%, ... with a share of ...%, ... with a share of ...% and ... with a share of ...%. Other domestic producers in total occupy about …% of the market.
The Indian carpet market is highly competitive and highly fragmented due to the presence of a significant number of local and foreign manufacturers. The Herfindahl-Hirschman index for the market is HHI=…, the market is ...
2.3. Profiles of major players
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Part 3. Analysis of carpet production
3.1. Volume and dynamics of domestic carpet production
Let's consider the dynamics of carpet manufacturing volumes in India.
Chart 16. Dynamics of carpet production volumes in India for 2015 - 2020 (Jan-Jun), mln sq. m
The dynamics of carpet production in India has a wave-like character in 2014-2019, however, it can be noted that the volume fluctuated around the average value of … mln sq. m. m until 2018, and in 2019 it amounted to … mln sq. m. m, which is almost by …% higher than the level of the previous year.
The decrease in demand for carpets in the second quarter of 2020, due to quarantine measures, store closures, a decrease in household income, as well as the suspension of enterprises, led to a forced decrease in production by …% in January-June 2020 compared to the same period in 2019.
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3.2. Share of exports in carpet production
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At the same time, the share of production for domestic consumption in 2014-2019 decreased from …% to …%.
3.3. Segmentation of carpet production by region
3.3.1. Production by Union Territories
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The undisputed leader among the federal districts in the production of carpets during the entire period under review is … Union Territories – production annually exceeds … sq. m. m, according to the results of 2019, … mln sq. m, for the period from 2015 to 2019, the share of this district in the total production decreased from …% to …%.
3.3.2. Production by states of India
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Part 4. Analysis of foreign trade deliveries of carpets
4.1. Volume and dynamics of carpet imports
Consider the indicators of foreign trade operations with carpets in India.
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The dynamics of imports in physical terms is undulating. A significant increase in prices for carpets in ruble terms due to the increase in the dollar in 2015-2016 led to a decrease in demand for them. Import showed a sharp drop by …% in 2015, and in 2016 it continued to be low, demonstrating an increase within …%. According to the results of 2017 alone, the volume of carpet imports into the country reached the pre-crisis level of … mln sq. m. m (growth for the year is almost …%). Further, in 2018 and 2019, import volumes remained at a fairly high level - more than … mln sq. m. m.
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4.2. Import structure
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Relative to the structure of imports by countries in 2013, the shares of the following countries decreased: … (…%), … (…%), … (…%), … (…%), … (…%) and … (…%). The shares of the following countries increased: … (by …%), … (by …%) and … (by …%).
4.3. The volume and dynamics of exports of carpets
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Diagram 24. Balance of exports and imports in the Indian carpet market in 2014-2019, mln sq. m
During the period under review, the trade balance (difference between exports and imports) in the carpet market in India remains ... The volume of imports ... exports more than ... times.
4.4. Export structure
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Part 5. Carpet Consumption Analysis
5.1. Carpet Consumption Volume Dynamics
The dynamics of changes in the consumption of carpets has … character. The per capita indicator in value terms … in 2015 due to … the level of solvency of the population and …, as well as due to … In 2017, the consumption indicator increased by …%, exceeding the value of 2014. In 2019, per capita consumption per year amounted to … Rs., which is …% higher than in 2018 due to an increase in the market volume in physical terms, as well as due to an increase in consumer prices.
5.2. Analysis of the results of tenders for the purchase
For the period from 01.01.2020/17.08.2020/ to / / , more than ... state and commercial tenders for the purchase of carpet products have been announced. In addition to carpets, the list of products purchased at the tender often includes ... The table shows government contracts for which the initial contract amount exceeds ... thousand Rs.
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Part 6. Price Analysis
6.1. Average producer prices by union territories
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6.2. Average consumer prices by states in India
Table 12. Average consumer prices in the carpet market (by name carpets/synthetic carpets) by states of India in 2014-2019, Rs./sq. m
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In general, in India, the average price for synthetic carpets in 2019 compared to 2018 increased by …%, which is higher than the level of the Consumer Price Index for non-food products (CPI is equal to …%). Over the period from 2014 to 2019, the price of carpets increased by …%, which is lower than the increase in prices for non-food products (CPI is equal to …%)....
List of diagrams
Diagram 1. The ratio of imported and domestic products in the carpet market in India in 2014-2020. (Jan.-Jun.) in physical terms, %
Diagram 2. Dynamics of the carpet market volume, 2014 - 2020 (January-June), mln sq. m
Diagram 3. Revenue (net) from the sale of carpets in the union territories for 2015 - 2019, %
Chart 4. Dynamics of India's GDP, 2007-2019, Q1 2020, % to the previous year
Chart 5. Expert forecasts for a decline in real GDP in India in 2020 (baseline/neutral scenario), %
Chart 6. Monthly dynamics of the US dollar against the rupee, 2015-2020 (Jan-July), Rs. for 1 US dollar
Diagram 7. Dynamics of India's IPP in 2014 - 2020 (1pg), % to the previous year
Diagram 8. Population dynamics in India as of January 1, 2010-2020, million people, %
Diagram 9. Population forecast in India for the period 2021-2024, million people
Diagram 10. Dynamics of real incomes of the population of India, 2011 - 2019, % to the previous year
Diagram 11. Commissioning of residential buildings in India in 2010-2019, mln sq. m of total area
Diagram 12. Commissioning of commercial buildings in India in 2010-2019, mln sq. m
Chart 13. Dynamics of the average interest rate on loans, 2015-2020 (Jan-Jun), %
Figure 14. Carpet Market Life Cycle Stage
Diagram 15. Shares of the largest competitors in the carpet market in 2019, %
Chart 16. Dynamics of carpet production volumes in India for 2015 - 2020 (Jan-Jun), mln sq. m
Diagram 17. Dynamics of the total revenue of the largest manufacturers (TOP-5) of carpets in India, 2015-2019, billion Rs.
Chart 18. Share of exports in production, 2014–2020 (Jan.-Jun.). %
Diagram 19. The structure of carpet production by states of India in 2019,%
Diagram 20. Volume and dynamics of carpet imports to India in kind in 2014-2020 (January-June), mln sq. m
Diagram 21. The volume and dynamics of carpet imports to India in monetary terms in 2014-2020 (January-June), thousand dollars
Diagram 22. Dynamics of export of carpets from India in kind in 2014-2020 (January-June), mln sq. m
Diagram 23. Dynamics of export of carpets from India in monetary terms in 2014-2020 (January-June), thousand dollars
Diagram 24. Balance of exports and imports in the Indian carpet market in 2014-2019, mln sq. m
Chart 25. Structure of exports by countries in 2019 in physical terms, %
Diagram 26. Dynamics of carpet consumption in monetary terms, 2015 - 2019, Rs./person
Diagram 27. Forecast growth rates of real incomes of the population for the period from 2020 to 2024, %
Diagram 28. Forecast of the carpet market volume in 2020 - 2024 with 1 quarantine, mln sq. m
Diagram 29. Forecast of the carpet market volume in 2020 - 2024 with 2 quarantines, mln sq. m
List of tables
Table 1. Expert forecasts for a decline in real GDP in India in 2020 (baseline/neutral scenario), %
Table 2. Urban and rural population in India in 2014-2019, million people, %
Table 3. Weighted average interest rates of credit institutions on credit operations in rupees, excluding PJSC Sberbank (% per annum), 2015-2020 (Jan-Jun)
Table 4. STEP analysis of factors affecting the carpet market
Table 5. Advantages and disadvantages of substitute products
Table 6. Main companies participating in the carpet market in 2019
Table 7. Profiles of companies participating in the carpet market in 2019
Table 8. Dynamics of carpet production in India by union territories in 2015-2019, thousand square meters m
Table 9. The structure of carpet imports by importing countries in 2019 in physical terms, units rev.
Table 10. Tender contracts for the purchase of carpets announced from 01.01.20/17.08.20/500 to / / in the amount of more than thousand Rs.
Table 11. Average producer prices in the carpet market across the Union Territories in 2015-2019, Rs./sq. m
Table 12. Average consumer prices in the carpet market (by name carpets/synthetic carpets) by states of India in 2014-2019, Rs./sq. m
Table 13. Assessment of factors of investment attractiveness
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