Concerns about security and the economic climate have prevented Gokaldas Exports, a major participant in the textile and apparel industries, from creating capacity since the company has been anticipating “problems” in Bangladesh.
Foreign brands are currently attempting to de-risk their commercial dealings with Bangladesh, and some European corporations have approached them with support in meeting demand, according to Gokaldas Exports vice chairman and managing director Sivaramakrishnan Ganapathi, during the earnings call following the June quarter results.
“A directional shift to more sourcing from India will definitely happen and that augurs well for us from a capacity creation standpoint,” Ganapathi added. Gokaldas exports to over 50 countries including the US, Canada and some European nations.
The managing director of Gokaldas, Ganapathi, stated that the company’s order books are filled for the upcoming quarters and that the company ‘may not stand to benefit’ too much right away because they no longer have the capacity to accept orders. But he noticed that India is now receiving more orders for textile exports. “A directional shift to more sourcing from India will definitely happen and that augurs well for us from a capacity creation standpoint,” stated Ganapathi.
Gokaldas Exports claims that stronger players are in a better position to take advantage of the benefits resulting from this, given the enormous volumes of orders coming from Bangladesh.
After speaking with a few Bangladeshi textile industry participants, Ganapathi stated that while most of the country’s factories had reopened, it is still “not out of the woods.” In FY24, Bangladesh’s top export category was textiles. “The garment industry in Bangladesh is a significant industry and the government will do everything in their power to make sure that the garment industry functions well,” stated Ganapathi.
Sivaramakrishnan G told analysts that global customers had been sensing some unrest for almost a year. “Many of the customers have talked to us almost a year back saying that we want
to diversify away from Bangladesh. So, customers who are, let’s say, heavily weighted towards Bangladesh have had come to us and talked about incremental capacity here,” he said, adding that more customers will diversify going forward.
