NewsStocksExport-heavy stocks slide up to 11% as Trump threatens 500% tariff; Avanti Feeds, Kitex Garments lead lossesExport-heavy stocks slide up to 11% as Trump threatens 500% tariff; Avanti Feeds, Kitex Garments lead losses
Export-oriented stocks declined up to 11% for the second consecutive session after US Senator Lindsey Graham announced Trump's approval of a bipartisan Russia sanctions bill proposing 500% duties on Russian imports. Seafood exporters like Avanti Feeds and textile companies including Kitex Garments led the losses, with investors concerned about potential disruption to US shipments and higher trade barriers. Crisil projects Indian home textile makers could see 5-10% revenue decline this fiscal due to existing 50% US tariffs.
*this image is generated using AI for illustrative purposes only.
Export-oriented stocks extended their decline for a second consecutive session on Friday, with several companies experiencing significant losses up to 11% following fresh political developments from the United States that have rekindled fears of substantially higher trade barriers.
Political Developments Drive Market Concerns
The selling pressure intensified after US Senator Lindsey Graham announced that Trump had approved a bipartisan Russia sanctions bill. This legislation proposes duties of at least 500% on Russian imports and could potentially be used to pressure countries, including India, that continue to purchase Russian oil. The announcement has created uncertainty among investors regarding potential impacts on Indian exporters.
Seafood Exporters Face Significant Pressure
Seafood exporters were among the worst performers during the trading session, reflecting concerns about direct disruption to shipments to the US, which represents the most important market for Indian shrimp exporters.
| Company | Price Movement | Closing Price |
|---|---|---|
| Avanti Feeds | -2.20% | ₹793.00 |
| Apex Frozen Foods | -3.20% | ₹267.00 |
| Coastal Corporation | -1.50% | Not specified |
| Waterbase | -4.50% | ₹44.00 |
| Sharat Industries | -1.00% | Not specified |
Textile Sector Under Significant Strain
Textile exporters came under considerable pressure as investors priced in the risk of weaker US demand and higher landed costs in the event of punitive tariffs being implemented.
| Company | Price Movement | Closing Price |
|---|---|---|
| KPR Mills | -3.00% | ₹825.00 |
| Vardhman Textiles | -2.00% | Not specified |
| Gokaldas Exports | -1.30% | Not specified |
| Kitex Garments | Up to -11.00% | Not specified |
| Indo Count Industries | Up to -11.00% | Not specified |
| Sutlej Textiles | Up to -11.00% | Not specified |
| Welspun Living | Up to -11.00% | Not specified |
Existing Tariff Structure and Future Concerns
The market concerns were amplified by earlier warnings from Trump that Indian exports could face higher tariffs if New Delhi does not address US concerns over its purchases of Russian crude oil. Currently, the US has already imposed tariffs of up to 50% on certain Indian products, with approximately half of that burden directly linked to India's Russian oil imports.
Industry Impact Assessment
According to a recent Crisil report, India's home textile manufacturers could face a 5-10% decline in revenue during the current fiscal year following the US imposition of 50% tariffs. This impact is particularly significant as exports to the US contribute nearly three-fourths of the industry's total revenue.
| Financial Metric | Previous Fiscal | Expected Current Fiscal |
|---|---|---|
| Operating Profitability | Baseline | -200 to -250 basis points |
| Interest Coverage Ratio | 5.40 times | ~4.00 times |
| Debt-to-Ebitda Ratio | 1.90 times | 2.40-2.60 times |
Crisil expects industry-wide operating profitability to contract by 200-250 basis points during the current fiscal year. This contraction will reduce cash accruals and weaken overall credit metrics. The pressure is expected to be more acute for companies with heavy reliance on the US market.
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