India's Raymond reports Q3 profit fall on higher expenses

Raymond

01/02/2023 10:54

BENGALURU, Feb 1(Reuters) - Textiles maker Raymond Ltd
 RYMD.NS  reported a 5.4% fall in third-quarter profit on
Wednesday, hurt by steep commodity and inventory costs as
surging inflation dented demand for clothing.
    Consolidated net profit fell to 948.4 million rupees ($11.58
million) for the three months ended Dec. 31. The quarter also
accounted for a one-time tax-related impact of 735 million
rupees.
    India's textile industry has been contending with sluggish
demand while also battling higher freight and commodity costs.
    Total expenses for the quarter rose 17.3%, mainly due to a
more than 35% rise in raw material costs.
    Typically, clothing retailers in India clock a bulk of their
sales from late September to early November during the Hindu
festive season, when Indians spend heavily on clothes.
    However, consumer spending has moderated since then, with
customers in smaller cities spending more on essentials such as
food and fuel due to rising living costs.  
    Raymond's branded textile segment, which contributes around
40% to the company's revenue and is its biggest business,
reported a marginal 0.3% growth for the quarter.
    The company's shares fell 9.6% after the results. They have
fallen over 6% so far this year, following a more than two-fold
increase in 2022.
    Overall, revenue from operations rose over 17% to 21.68
billion rupees.
($1 = 81.9280 Indian rupees)
 (Reporting by Nishit Navin in Bengaluru; Editing by Janane
Venkatraman)
 ((Nishit.Navin@thomsonreuters.com;))