Indian apparel retailer Arvind reported a 40% decline in its first-quarter profit, driven by inflationary pressures that reduced consumer spending on apparel despite ongoing discounts. The company’s net profit fell to Rs. 39.3 crore from Rs. 65.8 crore in the same period last year. Arvind, which offers international brands such as Tommy Hilfiger, Arrow, and Calvin Klein in India, has been significantly affected by these economic conditions.
The Indian textile sector faced weak demand throughout FY 2024, with consumers becoming more cautious about spending on non-essential items. Retail inflation remained around 5% for the April-June quarter, driven primarily by high food prices, which led to decreased expenditure on discretionary goods.
Arvind witnessed a 1 per cent decline in revenue from operations, with its core textile segment—accountable for 73 per cent of total sales—dwindling by 5 per cent in comparison to last year. The company also shared disruptions caused by “illegal workers’ unrest” at its largest factory, which disturbed performance in the woven and denim segments for 21 days. This strike had an projected revenue impact of around Rs. 200 crore.
Despite efforts by retailers to entice customers with discounts, Arvind’s total expenses rose by 1 per cent, putting extra strain on its margins. The advanced materials segment, which manufactures fabrics and protective gear for construction, witnessed a 4 per cent decline.
