Textile stocks showed mixed performance on Friday, 5th September, as investor sentiment remained cautious following the Goods and Services Tax (GST) reforms announced earlier this week.
In its meeting on 3rd September, the GST Council approved an increase in the tax rate from 12% to 18% on apparel and clothing accessories priced above Rs. 2,500 (US $ 29) per piece, as well as on other made-up textile articles and sets exceeding the same threshold.
Kitex Garments gained 2.47%, while Aditya Birla Fashion and Retail rose 0.89%, and Vedant Fashions, owner of ethnic wear label Manyavar, advanced 0.78%. Other gainers included Vardhman Textiles (0.40%), Bombay Dyeing (0.38%), Welspun Living (0.28%) and VIP Clothing (0.17%).
However, profit booking weighed on several counters. Gokaldas Exports slipped 1.78%, Indo Count Industries fell 0.84%, KPR Mills dropped 0.63%, Trident declined 0.32%, and Raymond Lifestyle edged down 0.02%.
The Government said on Thursday that the rationalisation of GST rates for the textile sector was expected to reduce costs, support exports, sustain jobs, and stimulate domestic consumption, helping to advance India’s textile and apparel market towards its target of US $ 350 billion by 2030.
Key reforms include a 5% rate for readymade garments and made-ups priced up to Rs. 2,500 (US $ 29) per piece, compared with the previous limit of Rs. 1,000 (US $ 12). Officials stated that this measure would make affordable apparel cheaper, particularly benefiting middle-class and low-income households.
