Why Textile Stocks Are Rising

Today, 10 September 2025, the Indian markets delivered strong gains.

At the time of writing, the Sensex closed up about 324 points or 0.40% at around 81,424, and the Nifty 50 closed up 104 points or 0.4% near 24,973.

The market sentiment was bolstered by optimism around US-India trade talks and other positive domestic triggers.

Textile export-oriented stocks were in the limelight today.

Let's tell you some reasons why textile stocks have gained sharply.

4 Reasons Why Textile Stocks are Rising

#1 Optimism Around the India-US Trade Talks

Stocks of Indian textile exporters to the US are rising sharply today due to renewed optimism around the India-US trade talks.

Key textile companies that export to the US, like Welspun Living, Gokaldas Exports, Vardhman Textiles, Trident, and Pearl Global have seen their stock prices increase up to 9%.

This positive movement is driven by hopes of a trade deal between India and the US that could reduce or resolve the additional tariffs of around 25% imposed on Indian textile exports to the US.

#2 Weakening Rupee

Over a 2-month period, the Indian rupee has depreciated against the US dollar.

The USD/INR was around Rs 86.7 per dollar in mid-July 2025 and moved to approximately Rs 88.15 per dollar by 10 September 2025, a depreciation of about 1.6-1.7%.

The weakening rupee tends to benefit exporters.

#3 Buying Support at Lower Levels

Stocks of textile companies exporting to the US have been badly hit, ever since US President Donald Trump imposed an additional tariff on India.

Most stocks from the space have fallen sharply in the last two months.

There was buying support at lower levels in these stocks, as investors felt the risk-reward ratio had turned favourable.

#4 Exemption on Cotton Import Duty

This was not an immediate reason for the rally in textile stocks, though it is worth highlighting that following a 50% tariff by the US, the finance ministry extended the exemption on cotton import duty by another three months to 31 December 2025.

The move is expected to help the Indian textile industry place long-term cotton import orders.

What Next for Export-Oriented Textile Stocks

Sentiment remains optimistic around the ongoing India-US trade talks, which could ease or remove high US tariffs on Indian textile exports imposed.

This optimism has led to rallies in key textile stocks such as Welspun Living, Vardhman, Peral Global, Gokaldas Exports, and Raymond.

India's textile exports are on a growth trajectory. Cumulative exports for April to July 2025 stood at US$ 12.18 bn, a 3.87% increase over the same period in the previous year.

In July 2025, textile and apparel exports reached US$ 3.1 bn, marking a 5.37% YoY growth.

This reflects the robust expansion of the country's textile industry driven by both domestic demand and strong international market presence.

Despite global volatility and steep tariffs, India's textiles have displayed resilience, though full impact of tariffs is likely to be felt later.

Overall, Indian textile stocks are showing selective strength led by exporters and large-cap firms, supported by policy measures and global trade optimism, but investors remain cautious given regulatory changes and cost pressures.

How Export Oriented Textiles Stocks Have Performed Recently

The last one month has seen good gains in export-oriented textile stocks with most of the gains coming on 10 September 2025, thanks to optimism over a potential trade deal.

Conclusion

Investors and companies will have to wait patiently for the final outcome of the US-India trade tariff talks. That apart, export-oriented textile companies in India are expected to benefit from increasing global demand, government schemes like PLI, and trade agreements like the India-UK FTA.

Overall, the outlook for export-oriented textile companies in India remains optimistic with strong government backing, expanding export markets, and structural industry improvements driving growth for 2025-26 and beyond.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...