Textile Firm Arvind Plans US Design Studio and Outlines FY27 Capital Expenditure

Gujarat-based textile firm Arvind is in the process of conceptualising a third international design centre in the US, following the establishment of similar studios in London and Amsterdam. According to Vice-Chairman Punit Lalbhai, the proposed US studio aims to add to the company's network of design and technical talent, helping to sharpen product development, innovation, and customer engagement in key international markets.

This expansion aligns with the company's strategy to move beyond its traditional strength in fabric manufacturing and build a stronger position in higher-value, vertically integrated garmenting. The shift is also a response to changing sourcing preferences among international brands, particularly as global customers look to diversify their manufacturing exposure and increase sourcing from India following the implementation of the India-UK free trade agreement.

Arvind expects the initial benefits of the trade agreement to reflect in its business during the first half of the fourth quarter, with UK business anticipated to be significantly higher next year. Sourcing opportunities from the British market are expected to focus primarily on finished garments rather than fabric.

Alongside its international design expansion, Arvind is preparing for an ambitious scale-up of its garmenting operations. The company is targeting around 15 percent growth through existing brownfield opportunities over the next three to four quarters while advancing one or two greenfield projects. It is also working on a more ambitious 25 percent growth model that could be launched in subsequent quarters.

A key part of this operational expansion is the Varanasi facility, which will manufacture essentials and knitted garments—categorized by the company as among its most profitable segments. The unit is expected to add approximately 25 million pieces of essentials capacity, though these smaller garments are separate from Arvind's existing 50-million-piece garmenting capacity. Ramping up this facility will be a primary focus over the next six to eight months.

Financially, Arvind has earmarked ₹120-150 crore toward garmenting investments for FY27, which forms part of a broader capital expenditure programme of ₹450-500 crore. Within this overall capex plan, another ₹200 crore has been allocated to advanced materials, with the remaining balance designated for fabric capacity and maintenance.

"Arvind's strategic move to establish a US design studio and scale its vertically integrated garmenting operations highlights a clear focus on moving up the value chain. By aligning its capital expenditure with shifting global sourcing trends and trade agreements like the India-UK pact, the company is positioning itself to capture international demand for finished garments. Balancing near-term brownfield optimization with long-term greenfield planning demonstrates a measured approach to capacity expansion." — Dr. Shishir Gupta, Founder & CEO, StartupLanes