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Bangladesh crisis: List of potentially impacted Indian companies
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6 min read | Updated on August 07, 2024, 14:09 IST
SUMMARY
Bangladesh is facing a political crisis and instability. This could impact certain Indian companies with operations or business relations in Bangladesh. The article analyzes the impact on those companies.
List of companies impacted by recent events in Bangladesh
Bangladesh is India’s biggest trading partner in the Indian Subcontinent. India is the biggest exporter to Bangladesh amounting to 12% of its imports as per IBEF.
Trade status with Bangladesh from an Indian standpoint (FY24)
| Particulars | Amount ($ billion) | % of total |
|---|---|---|
| Exports to Bangladesh ($ bn) | 11.0 | 1.4% of total Indian exports |
| Imports from Bangladesh ($ bn | 1.8 | 0.2% of total Indian imports |
Source: IBEF, PIBl, news articles
Bangladesh’s recent political instability could impact certain Indian companies - listed below.
Please note:
- The list is non-exhaustive. The stocks mentioned are selected based on the size and data availability.
- The price return is for August 06, 2024.
- The last few days have seen market volatility due to news from Japan. Price return shown below could also be impacted by that.
Consumer companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Pidilite Industries | Bangladesh's operations contribute ~3% of profits | 1,55,423.1 | -3.0 |
| Godrej Consumer Products | Investments in Bangladesh operations around ₹500 crore and planned to further expand business | 1,51,270.6 | 1.2 |
| Marico | PAT contribution from Bangladesh is ~24% | 81,338.1 | -6.3 |
| Adani Wilmar | Revenue exposure to Bangladesh is ~4% | 47,348.3 | -4.3 |
| Jubilant FoodWorks | Bangladesh's investments contribute ~2% of its total assets | 39,452.4 | 2.5 |
| Emami | Bangladesh operations contribute ~5% of its revenue | 34,134.0 | 2.2 |
| VIP Industries | Sources ~30–35% of production capacity from Bangladesh | 6,306.3 | -1.4 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Railway companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Garden Reach Shipbuilders & Engineers | Won a ~$21 million order for advanced ocean-going tugs for Bangladesh Navy and a ~$16.5 million contract from Bangladesh Inland Water Transport Authority | 24,056.8 | -5.0 |
| Rites | Won a ~₹906 crore contract for supplying passenger coaches | 16,569.7 | 0.1 |
| Texmaco Rail & Engineering | Won a ~₹200 crore contract for supplying rail coaches | 9,549.2 | -1.1 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Power companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Adani Power | Company supplies power to Bangladesh; Contributed ~15% of FY24 revenue | 2,65,646.0 | -0.3 |
| NHPC | Constructing a 1,320-MW coal-based power plant and along with BHEL operating power plant in Bangladesh | 98,260.1 | -0.5 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Pharma companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Sun Pharmaceutical Industries | Recently built a new pharma plant in Bangladesh | 4,09,782.4 | -0.7 |
| Zydus Wellness | Operates in Bangladesh with respective unit contributing ~17% of its total assets | 13,986.7 | -0.2 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Oil companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Indian Oil Corporation | Exports petrochemical products to Bangladesh | 2,35,756.4 | -2.0 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Auto companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Hero MotoCorp. | Bangladesh operations contribute ~2–3% of Hero MotoCorp.'s revenues and ~50–60% of the company's total exports. | 1,03,449.5 | 0.2 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Telecom companies*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| Bharti Airtel | Operates through Robi Axiata, owning a ~28% stake contributes ~5% of its total revenue in FY24 | 8,62,635.9 | 1.4 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg; *latest available data
Finally, looking at the impact on the textile sector
Bangladesh’s monthly apparel export is around $3-3.5 billion which is almost 2x of India. Experts believe that India could gain an additional business of $300-400 million per month.
List of select textile and apparel companies
| Company | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|
| K P R Mill | 32,401.2 | 14.9 |
| Trident | 19,212.8 | 3.7 |
| Vardhman Textile | 15,031.9 | 3.5 |
| Arvind | 10,103.2 | -1.2 |
| Indo Count Industries | 7,593.4 | 2.2 |
| Gokaldas Exports | 7,487.7 | 17.0 |
| Lux Industries | 7,075.7 | 4.1 |
| Kewal Kiran Clothing | 4,021.3 | 0.5 |
| Dollar Industries | 2,993.2 | 7.5 |
| Nitin Spinners | 2,456.3 | 6.6 |
| Rupa | 2,462 | 2.5 |
| RSWM | 1,171.7 | 7.1 |
| Ambika Cotton | 1,142.8 | 3.9 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg.
Some textile companies that could be adversely impacted*
| Company | Link with Bangladesh | Market Cap (in ₹ crore) | 1 Day return (%) |
|---|---|---|---|
| PDS | Has operations in Bangladesh with revenue exposure of 6% | 7,344.8 | -0.1 |
| Pearl Global Industries | Derives 25% of its revenue from Bangladesh and recently suspended manufacturing operations their | 4,138.2 | -3.2 |
Source: Company’s annual reports, press releases, investor presentations, NSE, Bloomberg.
Conclusion
These companies could see some short-term impact. Investors are urged to anlayse them on their own fundamentals before making any decisions.
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