by
Bloomberg
Published
August 6, 2024
Shares of Indian textile manufacturers rose on bets they could benefit from political unrest in Bangladesh that threatens to disrupt supply chains.
Bangladesh’s textile exporters are at risk of losing business amid political instability that has seen violent protests force Prime Minister Sheikh Hasina to flee the country on August 5.
Shares of Indian manufacturers including KPR Mill, Arvind Ltd, Gokaldas Exports Ltd, Vardhaman Textiles Ltd and Welspun Living Ltd rose more than 10% in Mumbai, amid expectations of higher market share.
Bangladesh has seen rapid growth in exports of ready-made garments and other textile products, making it the world’s second-largest exporter of such products after only China. The country’s textile exports were worth $45 billion in 2022, more than double India’s.
“If there are frequent disruptions to Bangladesh’s supply chains, global buyers may look for alternatives,” said Prerna Jhunjhunwala, an analyst at Elara Securities Ltd. “Indian players are well positioned to capture market share in this situation as they have the vertically integrated capacity to cater to global companies.”
The military in Bangladesh has vowed to install a new interim government in the country after Hasina, one of Asia’s longest-serving leaders, resigned and fled the country amid protests that have left dozens dead.