Arvind Q1 Results: Textile business aids revenue growth, margin expansion – CNBC TV18

Arvind Ltd. reported steady fourth quarter results on Tuesday, July 29. The stock had surged in response but gave up all of those gains soon after.

The company’s profit after tax (PAT) increased 45% to ₹57.7 crore in the June quarter from ₹39.8 crore in the year-ago period.

Its revenue of ₹1,811 crore was 7.3% higher than last fiscal’s ₹1,687.8 crore.

The company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 24.71% in the first quarter to ₹163.2 crore from ₹130.86 crore in the previous year.

Its EBITDA margin expanded to 9% from 7.75% in the year-ago quarter.

The company’s denim and woven segment volumes increased 9% and 8%, respectively. The advanced material division (AMD) clocked 16% volume growth.

Segment performance

Arvind’s textile segment’s revenue was at ₹1,536 crore, up 13.8% from the previous year’s ₹1,350 crore. Its margin expanded to 8.4% from 7.4% in the year-ago period.

The company’s revenue in the advanced material segment increased 6.8% to ₹351 crore from ₹329 crore in the previous year. Its margin contracted to 12.9% from 13.9% in the first quarter of the previous fiscal.

The management highlighted that the US business environment remains uncertain. However, the India-UK free trade agreement (FTA) is expected to trigger a fresh demand shift to India, and the early festive season trends are indicating that the growth momentum may continue.

Management Outlook

Arvind’s management expects its garment and AMD segments to clock double-digit growth in the second half of this financial year, along with improved margins.

The company is also expecting defence and a few higher value customer programmes in AMD to revive in the second half.

Arvind Ltd. shares were up 0.5% at ₹337 apiece around 2pm on Tuesday. The stock has declined 18.6% this year, so far.

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