US Slashes Textile Tariff to 18%: Five Indian Exporters Set to Gain

US Slashes Textile Tariff to 18%: Five Indian Exporters Set to Gain

The India-US bilateral trade agreement has done something Indian textile exporters have been lobbying for years: meaningfully lower the cost barrier into the world's largest consumer market. With US import duties on Indian textiles dropping to 18% — down from the ~27% that had been squeezing margins — the math changes overnight for companies with significant American revenue.

Multiple news reports confirmed this on March 24, with Tamil Nadu textile exports already showing a 3.3% uptick and the government targeting 40 new markets to push a $48 billion textile export opportunity. But the real question for investors is: which listed companies are best positioned to capture this tailwind?

We searched through thousands of company filings on NSE to find out.

1. Welspun Living (WELSPUNLIV) — The Clear Front-Runner

Welspun Living is India's largest home textile exporter, and the US is its single biggest market. Per their FY24 annual report, the United States accounts for 41% of India's cotton textile exports, and Welspun is the dominant player in this corridor.

The numbers tell the story. Per their Q4 FY24 quarterly results, the company achieved its highest-ever yearly revenue of Rs 98,251 million, growing 19.6% year-on-year. Export business specifically grew 23% YoY in FY24, recording sales of Rs 75,329 million. Even into FY25, the momentum continued — Q1 FY25 total income of Rs 25,885 million grew 17% YoY with exports up 20%, and Q2 FY25 saw home textile exports grow 17% YoY with an EBITDA margin of 16%.

Critically, Welspun is doubling down on the US market. The company is investing US$12.5 million to set up a fully automated pillow manufacturing unit in Ohio through its subsidiary Welspun USA Inc., with an annual capacity of 6.7 million pillows and revenue potential of approximately US$50 million at full utilization. They have also approved Rs 326 crores for a new 6,400 MTPA Jacquard towel facility at Anjar, expanding total towel capacity to 96,400 MTPA. A lower US tariff makes all of this incremental capacity more profitable.

2. Trident Limited (TRIDENT) — Bed Sheets Turnaround Story

Trident operates across yarn, towels, bed sheets, and paper. The bed sheets segment has staged a remarkable turnaround that a tariff cut could accelerate further.

Per their FY24 annual results, consolidated revenue from operations reached Rs 68,088 million, up from Rs 63,323 million in FY23. The bed sheets segment is where the real story lies — segment profit surged to Rs 2,239 million in FY24 from just Rs 610 million in FY23, a nearly 4x jump. The towel segment also improved, with profit rising to Rs 1,524 million from Rs 745 million.

Trident expanded bed sheet production capacity by 55,000 meters per day during the year, per their Q4 FY23 quarterly results. With a lower tariff into the US, this added capacity could translate directly into higher-margin export orders rather than competing in the price-sensitive domestic market.

3. Indo Count Industries (ICIL) — Building a US Moat

Indo Count has been the most aggressive among Indian textile companies in building direct US market presence. Per their quarterly filings, the company acquired Grace Home Fashions LLC, a US subsidiary of GHCL, and more recently acquired 100% of Modern Home Textile, Inc. in Arizona, per their Q2 FY25 quarterly results.

The company also acquired all domain names of the heritage brand 'Wamsutta' for US$10.25 million, per their FY24 quarterly results. This is a company that isn't just exporting to the US — it is building brands and distribution inside the US market. A lower tariff reduces the landed cost of goods shipped from their Indian manufacturing base in Kolhapur to their US sales operations, directly improving the competitiveness of their entire supply chain.

Indo Count also benefits from government export incentive schemes, having recognized RoSCTL export incentives of Rs 49.99 crores on eligible apparel and made-up exports, per their FY23 quarterly results.

4. Filatex India (FILATEX) — The Upstream Play

While home textile makers get the direct benefit, the tariff cut also helps upstream yarn manufacturers by pulling through higher demand. Filatex India, one of India's largest polyester yarn producers, reported FY25 revenue of Rs 4,252 crores with EBITDA of Rs 257.7 crores and net profit of Rs 134.6 crores, per their Q4 FY25 quarterly results.

The company has also benefited from the government's Quality Control Order (QCO) on polyester yarn, which reduced imports by nearly 60% in November 2023 compared to the prior year, per their Q3 FY24 earnings release. Higher US textile demand flowing through to Indian garment and fabric makers would increase domestic yarn offtake, supporting Filatex's production volumes which stood at 3,91,303 MT in FY25.

5. RSWM Limited (RSWM) — Recovery Candidate

RSWM's FY25 annual report is candid about the challenges: "The Indian spinning sector experienced subdued growth during FY 2024-25, primarily due to weak demand from key export markets, including the United States and Europe. Economic uncertainty, persistent inflation and declining consumer spending in these regions have led to a decrease in textile orders, affecting overall production and revenue."

This is exactly the kind of company where a tariff reduction could reverse the cycle. When US buyers face lower import duties, order volumes recover — and spinners like RSWM, who sit at the beginning of the value chain, are early beneficiaries. The company has been pivoting toward domestic markets to offset weak exports, but a tariff-driven revival in US demand would be a meaningful tailwind.

What Retail Investors Should Do

The US tariff cut from ~27% to 18% is a structural change, not a one-quarter event. Companies with high US export exposure — particularly in home textiles like towels, bed sheets, and bed linen — are the most direct beneficiaries. Welspun Living and Indo Count have the strongest US positioning, while Trident offers a turnaround angle. Upstream plays like Filatex benefit from increased demand pull.

However, investors should watch two risks: first, the ongoing West Asia tensions and potential Strait of Hormuz disruptions could increase shipping costs, partially offsetting the tariff benefit. Second, cotton price volatility remains a perennial risk for the sector. Look for companies with strong balance sheets, proven capacity to grow exports, and diversified customer bases.

The textile sector hasn't been a market darling recently, which means valuations in several of these names are reasonable. A 9 percentage-point tariff cut is the kind of structural catalyst that can re-rate an entire sector.