Vardhman Textile, Ambika Cotton to Welspun: Textile stocks surge up to 18% amid tariff turmoil. What’s behind the rally? | Stock Market News

Stock market today: Indian textile stocks traded in the green despite the higher-than-expected tariffs imposed by the Donald Trump administration on India. However, the 26% duty on Indian exports makes it one of the least-tariffed Asian exporters.

Other major Asian exporters face even steeper tariffs, with China now subject to a 54% duty on its exports to the US, while Vietnam faces a 46% tariff, Bangladesh 37%, and South Korea 25%, according to a series of charts shared by the White House on social media.

While some sectors witnessed heavy selling pressure in trade on Thursday, April 3, others remained resilient, with the textile sector being one of the key gainers.

Indian textile stocks, including Vardhman Textiles, rose up to 18% to ₹475 apiece, while Ambika Cotton Mills, KPR Mills, Welspun Living, S.P. Apparels, Nitin Spinners, Arvind, and Himatsingka Seide saw gains ranging from 1% to 10%.

Why are textile stocks rising today?

Following the US announcement of a 37% tariff on Bangladesh, expectations have risen that this could create opportunities for India to expand its textile exports.

Domestic brokerage Prabhudas Lilladher, in a recent report, stated that higher tariffs on textiles and apparel create an opportunity for India to gain a competitive edge in the US market.

The textile industry is a cornerstone of Bangladesh’s economy, accounting for 80% of its exports and contributing 15% to its GDP. Its primary export destinations include the European Union, the United States, Canada, Australia, and Japan.

Bangladesh’s apparel exports have seen a significant boost, pushing the country’s total exports to a record high of $55.56 billion in 2022–23. Apparel exports alone surged to nearly $47 billion, marking a 10.27% increase from the previous year, according to the Export Promotion Bureau (EPB).

However, the 37% reciprocal tariffs placed by the US on Bangladeshi exports have raised concerns, with experts suggesting that American buyers may now turn to India, which is currently well-positioned to benefit.

Meanwhile, the Indian government has been increasing its focus on the textile sector, offering incentives and reforms to strengthen domestic manufacturing. In the Union Budget 2025–2026, the Indian government announced a five-year mission aimed at enhancing the productivity and sustainability of cotton farming.

This initiative aligns with the government’s integrated 5F vision for the textile sector. Experts believe this strategy will boost farmers’ incomes and ensure a steady supply of high-quality cotton, supporting India’s traditional textile industry.

Additionally, ongoing political turmoil in Bangladesh has already led some global buyers to shift their sourcing to India. The latest developments add further momentum to this trend.

According to experts, India has been attracting apparel buyers in recent years, as brands and retailers increasingly diversify their procurement sources, given by the government’s series of initiatives taken to boost the sector.

Indian stock market recovered from early losses

While Asian markets traded in deep red on Thursday, April 3, following Donald Trump’s move to bring 180 countries under his tariff radar, global investors grappled with uncertainty. Trump imposed duties ranging from a base of 10% to as high as 49% on all major trading partners, triggering fresh concerns across financial markets.

While the full impact of these tariffs on individual countries will take time to materialise, investors wasted no time reacting. They swiftly offloaded shares, leading to sharp declines in major Asian indices, including the CSI 300, Hang Seng, and Nikkei 225, all of which bled in today’s session.

Although the Indian stock market initially mirrored the broader selloff seen in Asia, it managed to recover sharply as the day progressed. By noon, both benchmark indices were trading with minimal losses of around 0.20%.

The recovery in the stock market was largely supported by pharmaceutical stocks, as Trump excluded pharma imports from the new tariffs. This provided major relief to domestic pharma companies, many of whom have significant exposure to the US market.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.