Trident, KPR Mill, to Kitex: Textile stocks jump up to 20%, extend rally on India–US trade deal optimism

Textile stocks remained in the spotlight for the second consecutive session on Wednesday, February 4, building on robust gains from the previous session as the US–India trade deal announcement strengthened investor sentiment across the sector, making these counters more attractive to domestic investors.

After a 20% rally in the previous session, shares of Gokaldas Exports gained another 20% to hit the day’s high of ₹832.85 apiece. Indocount Industries shares also surged 20% to the day’s high of ₹343 apiece, a day after locking in the 20% upper circuit.

Faze Three was another stock that rallied 20% to reach ₹529.90 apiece. Other stocks from the sector also traded with strong gains, including Pearl Global (up 10%), Trident (up 4.5%), Welspun Living (up 4.3%) and KPR Mill (up 2.5%).

After multiple rounds of negotiations, the trade deal between India and the US finally took shape, improving earnings visibility, especially for export-oriented sectors. Textiles, being a labour-intensive industry, stand out as a key beneficiary.

Tariff relief gives India an edge over Asian peers

US President Donald Trump on Monday lowered tariffs on Indian imports to 18% from 25%. He is also reportedly removing an additional punitive 25% duty that was imposed in response to India’s purchases of crude oil from Russia.

The revised tariff structure places India at a competitive advantage, as other major Asian economies, including China, which has the largest export share to the US, are facing higher tariffs of up to 37% imposed by Washington.

For the textile sector, the announcement removed a key overhang, as analysts had earlier warned that sustained higher tariffs could lead global buyers to diversify orders toward competing countries such as Bangladesh and Vietnam.

Third major boost for textiles

Lower tariffs from the US have come as another major boost for the sector, following the finalisation of a landmark free trade agreement between India and the European Union in January.

Under the agreement, tariffs on textile and apparel products are expected to be reduced from 12% to zero, thereby enhancing cost competitiveness and improving market access in the European Union.

Sammir Dattani, Executive Director, Sanathan Textiles, said, “Europe is home to some of the world’s leading fashion brands and automotive manufacturers, both of which rely extensively on imported textiles for apparel, upholstery, technical fabrics, and automotive interior applications.”

In May 2025, India and the United Kingdom signed a free trade agreement after years of negotiations. The pact enhances the competitiveness of the Indian textile industry in the UK market, where competing countries such as Pakistan, Bangladesh, and Sri Lanka currently enjoy duty-free access under the UK’s Generalised Scheme of Preferences (GSP).

Trade deals support India’s textile export dominance

India is now among the top textile-exporting countries globally, with a share of approximately 4% of global textiles and apparel exports. The major export destinations for India in this segment are the United States, the European Union, and the United Kingdom, which together account for over 50% of total textile and apparel exports, according to media reports.

Notably, India has free trade agreements (FTAs) and bilateral trade agreements (BTAs) with all three regions.

According to domestic brokerage firm, JM Financial, India has exported textiles worth $5.1 billion in FY26 so far to the US, sharply lower compared with $8.3 billion of textile exports in FY25, a decline attributed to the impact of higher 50% tariffs.

Motilal Oswal flags key textile exporters as top beneficiaries

Motilal Oswal has identified select textile and apparel companies as the biggest beneficiaries of improving trade dynamics, citing their high exposure to the US market and potential gains in competitiveness versus peers such as Bangladesh and Vietnam.

According to the brokerage, companies including Raymond Lifestyle, Indocount Industries, Welspun Living, and Gokaldas Exports derive a significant portion of their revenues from the US—ranging between 65% and 90%—positioning them well to benefit from lower tariffs and stronger order flows.

Kitex Garments was also highlighted as a key beneficiary, with nearly 90% of its revenues linked to the US market, which could help revive utilisation levels at its underutilised capacities as demand improves.

Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.