Arvind offloads 10 per cent stake in Arvind Lifestyle Brands

Arvind, one of India’s largest integrated textile and apparel companies reported a marginal increase of 1.47 percent in consolidated net profit at Rs 71.7 crores for Q2 ended September 30, mainly on account of jump in employee benefit expenses. The company had reported consolidated net profit of Rs 70.66 crores in the July-September period of last fiscal.

Consolidated net sales went up 18.63 percent to Rs 2,319.11 crores during the period under review as against Rs 1,954.9 crores in the corresponding quarter of the previous fiscal, Arvind said in a BSE filing. Profit after tax dipped due to retrenchment compensation. During the quarter, employee benefit expenses stood at Rs 283.71 crores as against Rs 224.15 crores reported in the same quarter last fiscal.

“Our textiles business continues to deliver a strong performance as we continue to pursue a calibrated growth startegu. Our established power brands continues to consolidated their market positions,” said Arvind Director and Chief Financial Officer Jayesh Shah. Revenue from textiles segment during the period grew by 8.77 percent to Rs 1427.5 crores, while revenue from brand and retail business revenue increased by 32.86 percent to Rs 751.99 crore.

Meanwhile Arvind has divested a 10 percent stake in its business subsidiary Arvind Lifestyle Brands to Multiples. Arvind. Multiples is a private equity firm. At an enterprise value of Rs 8,000 crores, the deal is valued at Rs 740 crores, which would be used by Arvind to reduce its debt. Post this deal, effective November 2016, the overall debt on the group level of the conglomerate would decline to Rs 2,500 crores.

Arvind is also one of the largest producers of denim fabrics and is supplier to a large number of fashion brands in the world. Arvind’s brand portfolio is among the strongest and most impressive in India and includes global marquee brands such as Calvin Klein, Tommy Hilfiger, US Polo Assn, Ed Hardy, Hanes, Arrow, Gant and Nautica among others.

Promoter holding in the company stands at 43.76 percent while institutions and non-institutions hold 38.70 per cent and 17.53 percent respectively. The current market cap of the company is Rs 10,546 crores.