Lux Industries reported 64% jump in consolidated net profit to Rs 30.8 crore on 6% decline in income from operations to Rs 247.2 crore in Q1 FY21 over Q1 FY20.
EBITDA increased by 34% to Rs 47 crore in Q1 June 2020 from Rs 35.2 crore in Q1 June 2019. EBITDA margin was at 19% as on 30 June 2020 as against 13.4% as on 30 June 2019.
Commenting on the industry trends, Ashok Kumar Todi, chairman said, "With economic activities progressing towards normalcy, we are seeing green shoots in demand and expect coming quarters to be much better and robust. We are continuously engaging with our dealers, distributors and customers and getting positive responses and enquiries with each passing day."
Commenting on the results, Pradip Kumar Todi, managing director said, "The overall performance and profitability for the first quarter of 2020-2021 has been quite strong considering the COVID-19 outbreak followed by nationwide lockdowns. Our revenue has seen as slight degrowth of 6% even though our plant were shut for almost a month and half due to nationwide lockdowns. Despite these our EBITDA and PAT registered an absolute growth of 34% and 64% respectively due to improvement in operating efficiencies and cost reduction measures.
We continue to endeavour healthy profitability ratios by focusing on better product mix and rational cost optimisations. For the year, we plan to keep our branding and advertisement expenses to 4-6% of our revenues.
While the export market has been impacted due to supply chain disruptions and global restrictions on exports due to COVID-19, we are seeing good pick up of volumes in domestic markets and for the first quarter we saw slight growth in volumes too. We expect overall demand to return to pre-COVID levels in the coming quarters.
We have undertaken several measures to reduce our working capital cycle and for the quarter ended 30th June 2020, our working capital requirement reduced by approximately Rs. 80 crores and is at Rs. 413 crores compared to Rs. 494 crores as on March 2020.
Our proposed scheme to merge J. M. Hosiery & Co. (JMHL) and Ebell Fashions (EFPL) with Lux Industries Limited was on track to be approved by the NCLT, but due to the outbreak of CoVID-19 pandemic, it has got delayed and we expect the same to complete as soon as possible."
Lux Industries is one of the largest players in the hosiery business having a market share of approximately 20% of the organised industry. Its products include men's, women's & kids innerwear, winterwear, socks & slacks for Women in varied colours and designs.
The scrip fell 2.94% to Rs 1402.35 on the BSE. It traded in the range of 1392 and 1427 so far during the day.
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