Shares of Indian textile companies were in focus on Thursday after the United States signed a new trade agreement with Vietnam that reduces tariffs on Vietnamese textile and apparel exports to 20 per cent, down from the earlier effective rate of 46 per cent. According to analysts at Angel One Broking, while the move strengthens Vietnam’s competitive edge in the global textile market, it puts pressure on Indian exporters, intensifying the need for a favourable India-US trade pact.

Vietnam-US Trade Deal: A Double-Edged Sword for India

The deal, announced on July 2, grants Vietnam significant tariff relief when exporting to the US, while American goods to Vietnam will enjoy zero duties. This is expected to further solidify Vietnam’s position as a preferred sourcing hub for global apparel and textile giants.

For Indian textile exporters, this development increases the urgency of securing better access to the US market. If India fails to negotiate a tariff rate of 10 per cent or lower, the comparative advantage could remain with Vietnam, Angel One warns.

India Eyes Relief in Upcoming US Trade Talks

India and the US are currently in advanced talks to finalise a mini trade deal, which may be signed between July 4–5. The outcome is expected to play a crucial role in determining the competitive landscape for Indian exporters. Indian negotiators are pushing for tariff cuts in labour-intensive sectors such as textiles, garments, and home furnishings, while the US is seeking access to India’s agriculture and dairy markets.

All eyes are now on July 9, when new US tariff measures come into effect. A favourable agreement could offer Indian companies relief and allow them to better compete against Vietnamese exporters.

Gokaldas, KPR Mill, Welspun in Spotlight

Gokaldas Exports, which earns nearly 75% of its revenue from the US, traded down 1.06 per cent at Rs 921 despite its 3.94 per cent gain over the past week.

KPR Mill, with 21 per cent exposure to North America, gained 0.83 per cent to Rs 1,118.60 and is up 13.37% over the past three months.

Welspun Living rose 1.33 per cent to Rs 141.51. The stock has gained 6.84 per cent in three months.

Broader players like Vardhman Textiles and Trident also remain under investor radar, with potential upside if tariff gaps close in India’s favour.

Investor Takeaway

While Vietnam’s improved tariff access to the US raises competitive challenges for India, the upcoming India-US mini trade deal may turn the tide. If Indian exporters secure reduced duties, stocks like Gokaldas Exports, KPR Mill, Welspun Living, and Vardhman Textiles could see renewed traction and stronger order books in the second half of FY26.