US Tariff Impact: Raymond Eyes Vietnam, Bangladesh, Ethiopia As Strategic Alternatives

Textile major Raymond Ltd. is taking a cautious stance on the tariffs imposed by the United States on India, according to its Group Chief Financial Officer (CFO) Amit Agarwal. He called it a “volatile situation” where there should not be a “knee-jerk reaction based on one announcement made by the White House.”

“We have a long-term play. Out of our total garmenting revenue, almost 50-55% comes from the United States. Of that, almost 30% production is coming from our Ethiopian plant and Ethiopia continues to be at the lowest duty rate of 10%,” he said during a conversation with NDTV Profit on Thursday.

Agarwal highlighted that of the Rs 550 crore revenue from the garments business, approximately Rs 400 crore originates from India, while Rs 150 crore comes from its Ethiopian plant.

The company has the flexibility to further move some of its production from India to Ethiopia.

“The Ethiopian plant still has the capacity of another Rs 50 crore to Rs 75 crore, so we can transfer the business out of India into Ethiopia,” he said.

Another option in front of Raymond is to export fabrics to Bangladesh and Vietnam for garment production and subsequent shipment to the United States.

The timing of the tariffs poses challenges for the US retail market, particularly with the Thanksgiving and Christmas sales seasons approaching. He explained that the production and shipping cycle spans five to six months, making it difficult for US retailers to pivot quickly.

“In the US, they go for a Thanksgiving sale and a Christmas sale and the time for that is less than four months now. They would not be able to meet their requirement for this period. So, I think to that extent, they will find ways to get the products out of India,” the top executive noted.

Based on customer feedback, he expressed optimism that the situation could stabilise by the end of the second quarter of FY26.

He also underlined that 85% of the company’s business is in India and it won’t face any impact from the tariffs.

“We believe this festive season and the wedding should be much stronger. So, to that extent, we believe a stronger year this year compared to last year.”

Shares of Raymond Ltd. closed 1.59% lower at Rs 633 apiece on the NSE, while the benchmark Nifty50 settled at 24,596.15, up 0.09%.