India Polyester Yarn FY26 Outlook

The Indian Government has revoked the QCO on polymer and fibre intermediates (12 Nov 2025), giving relief to downstream textile sectors, especially readymade garments, through cheaper polyester imports amid ongoing US export tariffs.

The earlier 2023 QCO had mandated BIS certification to restrict low-cost imports from China.

Analysis of 20 polyester yarn manufacturers (covering 40–45% revenue) shows expected muted growth of 3–5% in FY26 due to stronger import competition.

Operating margins may drop ~100 bps to 5.5–6%, and interest coverage is likely to moderate to 2.7–2.9x (from 3.5–3.7x).

Home textiles (cotton-based) gain less benefit, while polyester yarn producers face pricing pressure and crude volatility.