Gap apparel supplier Gokaldas eyes doubling Europe exports share to cut US reliance

Gokaldas Targets Doubling Europe Exports Share to 30% Amid US Uncertainty

Gokaldas Exports Eyes European Growth as US Market Faces Uncertainty

By Praveen Paramasivam

Oct 26 (Reuters) - Indian apparel supplier Gokaldas Exports expects Europe to nearly double its share of exports as it benefits from a proposed trade deal, while diversifying beyond the US, a top executive told Reuters.

Shifting Export Focus: From US to Europe

Domestic garment exporters are looking beyond the United States as uncertainty over tariffs persists, while anticipating stronger demand from Europe as India secures better trade access.

Europe’s Growing Share in Gokaldas’ Exports

"Europe accounts for around 15% of our exports. Over the next three to five years, we expect Europe's share to increase to approximately 25%-30%," said Sivaramakrishnan Ganapathi, Gokaldas' vice-chairman and managing director.

Impact of India–EU Trade Agreement

The European Union is expected to sign a landmark trade deal with India by the end of 2026, cutting tariffs on imports.

Gokaldas is "actively holding discussions with major European retailers in preparation for duty-free trade," Ganapathi said without naming them, adding it is boosting capacity in India instead of moving production elsewhere.

Investment and Expansion Plans

The exporter, whose top customers include brands such as Gap, Carhartt, and JCPenney, is investing 1.25 billion rupees ($13.2 million) in fiscal 2027 to expand overall capacity and upgrade facilities.

Managing US Exposure and Market Trends

Gokaldas, which counts Pearl Global Industries and KPR Mill among its peers, expects the US share of exports to moderate from 69%, seeking to cut exposure to tariff shocks and policy uncertainty. It did not say by how much the share would fall.

Analyst Insights on Trade Opportunities

"The India–EU trade agreement could provide a medium-term opportunity to improve competitiveness, subject to implementation, product coverage and origin requirements," said Equirus Securities analyst Ronak Shah.

US Apparel Import Trends

US apparel imports from across the globe fell 7% to $49.08 billion in January-August, government data showed.

Order Outlook and Future Demand

But Gokaldas' US spring and summer orders for 2027 were stronger than the 2026 holiday season, when its shipments from India rose 3%-4% from a year earlier, Ganapathi said. He added that holiday sales would provide an early indication of demand for next year.

($1 = 94.9400 Indian rupees)

(Reporting by Praveen Paramasivam in Chennai; Editing by Sonia Cheema)