Arvind’s profit may fall 20 percent

Textile major Arvind’s profit on consolidated basis is expected to fall 20 percent year-on-year as its brand and retail business is likely to be hit by demonetisation. Revenue may grow eight per cent year-on-year and brand and retail business growth may be around nine to 10 percent. The company has guided 20 per cent growth in brand and retail for financial year 2017.

EBIDTA (earnings before interest, tax, depreciation and amortisation) is falling 14 percent and margin may contract 300 basis points to ten per cent compared with the year-ago period. The textile business is expected to grow at five to six percent for the quarter. The textile business (denim and fabric) contributes 60 per cent to total revenue and the rest is by brands and retail business.

Arvind is one of India’s largest integrated textile and apparel companies. It holds power brands like US Polo, Arrow, Calvin Klein, Tommy Hilfiger, US Polo Assn, Ed Hardy, Hanes, Arrow, Gant and Nautica. The company is also one of the largest producers of denim fabrics and is supplier to a large number of fashion brands in the world. The current market cap of the company is Rs 10,546 crores.