Editor’s Note
The recent India-EU Free Trade Agreement has sparked notable market optimism, particularly lifting shares in export-focused sectors like textiles. This analysis highlights the immediate investor response to the long-awaited deal.
The impact of the free trade agreement between India and the European Union is being seen in the stock market. Following this historic deal, significant activity was observed in the market on Tuesday, January 27, particularly in export-related companies. Shares of several textile exporting companies recorded a surge of nearly 12 percent.
The completion of this long-pending deal has boosted investor confidence, and the direct benefit is being seen in some select stocks. At the same time, it is expected that the Indian gems and jewellery business will also benefit. Let’s find out which stocks saw gains and how the jewellery sector could benefit.
The demand for Indian gems and jewellery remains constant worldwide. However, exporters were very disappointed after the US government’s decision to impose a 50 percent tariff. Traders were also suffering significant losses. Following this deal between India and the European Union, the Indian gems and jewellery sector will get a new opportunity to expand in the European market. The 10 percent tariff on gems and jewellery will be reduced to zero.
Once this agreement is implemented, labor-intensive industries are expected to benefit the most. Tariffs of up to 10 percent on approximately $33 billion worth of exports from sectors such as textiles, ready-made garments, leather, footwear, marine products, handicrafts, engineering goods, and automobiles will be eliminated. This will strengthen the competitiveness of these sectors in the global market.
On Tuesday, gains were seen in the shares of some textile and food-related companies in the stock market. Shares of Gokaldas Exports rose more than 5 percent to reach a level of Rs 585 on the BSE. Meanwhile, buying was also seen in KPR Mill shares, and its price increased by nearly 3 percent.
In addition, Welspun Living shares recorded a gain of 3.5 percent, after which the stock reached an intra-day high of Rs 125.25. Vardhman Textile shares jumped 5 percent to reach Rs 422. While Trident shares were recording a gain of 4 percent. During the trading day, the shares made an intra-day high of Rs 26.42.
Talking about the food sector, Avanti Feeds shares also saw strength of nearly 3 percent. Meanwhile, Apex Frozen Foods shares saw the highest surge, with its price rising up to 12 percent.
