Textile stocks witnessed strong buying interest on Thursday after confirmation that the India–UK Free Trade Agreement (FTA) will come into force on 15th July 2026, a development expected to significantly enhance the competitiveness of Indian textile and apparel exports in the UK market.
Shares of several textile companies gained sharply during intra-day trading on the BSE. Himatsingka Seide emerged as the top gainer, rising 8%. Gokaldas Exports advanced 6%, while Indo Count Industries climbed 5%. Kitex Garments and Nitin Spinners gained 4% each, while Pearl Global Industries rose 3%.
The implementation of the FTA is particularly significant for India’s textile sector. At present, Indian textile exports to both the UK and the European Union attract tariffs of around 12%. Under the trade agreements, these duties will be reduced to zero, placing India on an equal footing with major competitors such as Bangladesh and Vietnam, while providing an advantage over other exporting nations that continue to face tariff barriers.
Analysts at ICICI Securities said India’s competitive position is further strengthened by its relatively low labour costs, abundant domestic cotton availability and the recent removal of customs duty on cotton imports. The brokerage noted that large, integrated textile manufacturers with strong quality standards are likely to be among the biggest beneficiaries of the agreement.
According to ICICI Securities, discussions with textile companies indicate that several apparel and home textile buyers from the UK and Europe have already begun conducting due diligence on Indian manufacturing facilities in preparation for shifting sourcing orders following the implementation of the FTA.
The brokerage expects benefits from the UK trade agreement to start reflecting in the financial performance of textile companies from FY27 onwards, while gains from a potential India–EU FTA are likely to become visible from FY28. It added that a future trade arrangement with the United States involving lower tariffs could further boost order inflows, revenue growth and profitability across the sector.
Among the companies under ICICI Securities’ coverage, Gokaldas Exports, KPR Mill, Indo Count Industries and Pearl Global Industries are expected to benefit over the medium to long term due to their existing exposure to European and UK markets.
