Textiles, leather, pharma, auto related stocks end higher

New Delhi, Jul 24 (PTI) Shares of companies related to sectors such as textiles, leather, pharma, and auto, among others, ended higher on Thursday after India and the UK signed a free trade agreement, as the deal will boost exports from labour-intensive sectors, including textiles and leather, while making British cars and whisky cheaper in India.

Defying a weak trend in the broader equity market, leather-related stocks such as AKI India Ltd jumped 5 per cent, Mirza International went up by 1.86 per cent, Zenith Exports climbed 0.96 per cent, and Superhouse Ltd (0.47 per cent) on the BSE.

Textile-related stocks such as Pearl Global Industries surged 3.67 per cent, Welspun Living rallied 2.36 per cent, Vardhman Textiles climbed 1.88 per cent, Trident Ltd gained 1.68 per cent, Arvind Ltd advanced 1.04 per cent, and Alok Industries (0.20 per cent).

Tata Motors climbed 1.51 per cent and and auto components and equipment maker Sona BLW Precision Forgings went up by 0.28 per cent.

Shares of Dr Reddy’s Laboratories climbed 1.39 per cent, Lupin edged higher by 1.20 per cent, Sun Pharma (0.56 per cent), and Alkem Laboratories (0.44 per cent).

"The recently concluded UK-India Free Trade Agreement (FTA) represents a significant advancement in the bilateral relationship between the two nations, with the potential to elevate trade by an estimated USD 34 billion annually. Conversely, India will benefit from duty-free access for 99 per cent of its exports to the United Kingdom, thus bolstering essential sectors such as textiles, leather, gems and jewellery, and agriculture," Prashant Tandon, Executive Director – Listed Investments at Waterfield Advisors, said.

Despite a positive start, the 30-share BSE Sensex failed to carry forward the momentum and fell later in the trade. The benchmark tanked 542.47 points, or 0.66 per cent, to settle at 82,184.17. The 50-share NSE Nifty dropped 157.80 points, or 0.63 per cent, to 25,062.10.

The FTA is expected to benefit 99 per cent of Indian exports from tariffs and will make it easier for British firms to export whisky, cars and other products to India, besides boosting the overall trade basket, according to Indian officials.

The deal, firmed up after three years of negotiations, is expected to ensure comprehensive market access for Indian goods across all sectors, and India will gain from tariff elimination on about 99 per cent of tariff lines (product categories) covering almost 100 per cent of the trade values, they said.

Meanwhile, Jaguar Land Rover on Thursday said the India-UK free trade agreement would help the marquee automaker to access lower tariffs in India for its luxury models.

Under the India-UK FTA, India will reduce tariffs on automotive imports from about 110 per cent to 10 per cent under quotas on both sides, benefiting companies such as Jaguar Land Rover (JLR).

"We welcome this free trade agreement between the UK and India, which over time will deliver reduced tariff access to the Indian car market for JLR's luxury vehicles," a company spokesperson said in a statement.

JLR is owned by Mumbai-headquartered Tata Motors. PTI SUM SUM SHW