Gokaldas Exports targets larger Europe share to cut US risk

Gokaldas Exports expects Europe to account for 25%–30% of its exports over the next three to five years, up from around 15%, as the Indian apparel supplier seeks to reduce its reliance on the United States. The outlook, outlined on October 26, 2026, depends partly on improved trade access under the proposed India–European Union trade agreement.

Key Takeaways

• Management expects Europe’s export share to rise by 10–15 percentage points over three to five years.
• The company is expanding capacity in India rather than moving production elsewhere.
• Stronger US spring and summer orders for 2027 suggest diversification is not a withdrawal from its largest market.

Table of Contents

• Gokaldas Exports seeks a broader customer mix
• Trade benefits remain conditional
• Indian investment supports expansion
• Conclusion

Gokaldas Exports seeks a broader customer mix

Vice-Chairman and Managing Director Sivaramakrishnan Ganapathi said the company is discussing potential business with major European retailers in preparation for duty-free trade. He did not identify the retailers.

The United States currently accounts for 69% of exports. Gokaldas expects that share to moderate as it reduces exposure to tariff shocks and policy uncertainty, but it has not set out a target for the decline.

The European goal concerns the geographic mix of exports, not a stated forecast for total export revenue. A lower US share would not necessarily mean lower US sales if business in other markets grows faster.

Trade benefits remain conditional

The European Commission’s EU-India trade agreement objectives include removing trade barriers, simplifying procedures and opening export opportunities. These goals explain the commercial rationale for preparing European customer relationships, but they do not establish that duty-free access is already available.

The agreement still requires signature, approvals and ratification before taking effect. Expectations of signing by the end of 2026 are therefore not the same as a confirmed start date for tariff relief.

Equirus Securities analyst Ronak Shah said the agreement could improve competitiveness over the medium term, subject to implementation, product coverage and origin requirements. Those conditions will determine which garments qualify for any preferential treatment.

Indian investment supports expansion

Gokaldas is adding capacity and upgrading facilities in India rather than shifting production abroad. Its fiscal 2027 investment plan supports overall capacity, rather than a separately disclosed European production allocation.

The diversification effort also comes alongside stronger US spring and summer orders for 2027 than those for the 2026 holiday season, Ganapathi said. That order comparison contrasts with a broader decline in US apparel imports.

Ganapathi identified holiday sales as an early indication of demand for next year, making retail sell-through a nearer-term checkpoint than the company’s multiyear European target.

Conclusion

Gokaldas Exports is pursuing a larger European business while continuing to serve US demand. The next checkpoints are holiday retail sales and the remaining steps toward bringing the India–EU trade agreement into force; neither the European export target nor tariff benefits have yet been realized.

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