BENGALURU (Reuters) – Indian textiles firm Trident reported a 21% fall in its first-quarter profit on Wednesday as it struggled to keep a tight lid on expenses amid rising cotton prices.
The company supplies to stores including Shoppers Stop, DMart and online retailers Flipkart and Myntra.
Cost of cotton, a key raw material for Trident, has been elevated for more than a year, hurting profits.
Trident reported a consolidated net profit of 737.3 million rupees ($8.8 million) for the quarter ended June 30, compared with 934 million rupees a year earlier.
The company’s revenue from operations rose 17% to 17.43 billion rupees during the quarter from a year ago.
However, cost of raw materials rose nearly 18% during the quarter, causing a near 20% surge in total expenses.
This ate into the company’s profit.
Trident’s core yarn segment, the key revenue contributor, saw a 49% surge in revenue. The smaller paper and chemicals segment saw a near 5% drop in revenue, as paper prices continued to be under pressure due to heavy imports.
Shares of Trident closed 1.3% higher ahead of results.
($1 = 83.6810 Indian rupees)
(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Mrigank Dhaniwala)
