European Apparel Retail "Middle East Conflict - what is the Indian supplier ..."

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European Apparel Retail "Middle East Conflict - what is the Indian supplier ..."

Global Research

8 June 2026ab

European Apparel Retail Equities

Europe including UKMiddle East Conflict - what is the Indian supplier

base saying? Retailers, Apparel

Yashraj Rajani, CFA

Analyst

yashraj.rajani@ubs.com

India is a key sourcing market and a useful listed-supplier read-across +44-20-7901 5662

We further build our review of the Asian supply base following our recent call on Sreedhar Mahamkali

Bangladesh supply chain here. India exported about $10.9bn of textiles/apparel to the Analyst

US, $7.6bn to the EU and $2.2bn to the UK in FY25, making it an important sourcing sreedhar.mahamkali@ubs.com

market for western apparel retailers. Our review of recent reporting from Indian listed +44-20-7568 8040

suppliers to in terms of the Middle East conflict impact points to broadly the same Fatima Ortiz Nunez

themes in Bangladesh too. We note three key points: 1) No demand shock with stable Associate Analyst

relationships, recovering utilisation and steady inquiry pipelines; 2) Sharp increase in raw fatima.ortiz-nunez@ubs.com

material costs - cotton c25-30%; man-made fibres c20% all amplified by energy cost +44-20-7901 6085

shocks; 3) 8 out of 9 suppliers said they are trying to recover some of the cost increases Sunil Tirumalai

from retailers but none described full or immediate pass through as it looks like they Strategist

might achieve some pass through in H2 FY26/27. Again this aligns with our Bangladesh sunil.tirumalai@ubs.com

supplier call that talks to potential price increases to suppliers for Spring/Summer 27. +91-22-6155 6080

Broad cost inflation, not just freight

The suppliers we reviewed have broad based customer relations: PDS (Primark, Kohl’s),