Indian home shopping firm Vaibhav Global's profit drops for 7th straight quarter

Vaibhav Global

17/05/2023 11:28

BENGALURU, May 17 (Reuters) - India's Vaibhav Global Ltd
 VAIB.NS , which sells fashion jewellery, lifestyle and
electronics products in the U.S., UK and Germany, posted its
seventh straight quarter of profit declines on Wednesday as
consumers reined in spending on discretionary items.
    The company's fortunes boomed during the pandemic as people
splurged on home shopping and, to a smaller extent, buying
online through its Shop LC in the U.S. and TJC in the UK.
    However, that growth trajectory has come under pressure from
a high-base effect, the return of in-person shopping, stubbornly
high retail inflation and the company's continued investments.
    Vaibhav Global's consolidated net profit fell 14% to 233.9
million rupees ($2.86 million) in the January-March period, also
coming under pressure due to a rise in expenses.
    Its revenue, about two-thirds of which comes from home
shopping via TV, rose 1.2% to 6.93 billion rupees. Its sales
have fallen in two of the four quarters last fiscal, compared
with growth rates of 25%-30% in 2020/21, the peak of the
pandemic.
    To spark growth, Vaibhav Global has invested heavily in
advertising and marketing and its online business. But that has
eaten into profit. Its content and broadcasting expenses jumped
12% in the latest quarter.
    The company's shares surged about 256% over 2020-21, but
have since dropped nearly 48%. They were marginally lower on
Wednesday.
 
 ($1 = 81.7800 Indian rupees)

 (Reporting by Ashna Teresa Britto; Editing by Savio D'Souza)
 ((AshnaTeresa.Britto@thomsonreuters.com;))