Our growth strategy for domestic business is in place. We have an entire team for that, said Altaf Jiwani, CFO, Welspun India
Textile Company Welspun India today reported a profit after minority interest of Rs 96.6 crore in the July-September quarter. It had reported a loss of Rs 147.5 crore in the corresponding period of the last year. However, it was a sluggish quarter in terms of margins and revenue performance.
Altaf Jiwani, CFO, Welspun India said the Spaces brand is doing well and has growth of 47 percent for that. The brand is still new but at this kind of growth rate, it will start impacting the absolute numbers as well.
Our growth strategy for domestic business is in place. We have an entire team for that. So domestic business which is less than 5 percent will be around 20 percent of our revenues in next five years, said Jiwani.
In Q2 the company saw significant amount of de-stocking in the US market. Jiwani said, US market which is world's largest market and where Indian players are largest suppliers. In Q2 the offtake from US retailers was less by 12 percent compared to Q1 FY18, which affected volume of Indian players but expect de-stocking to be a transient phenomenon and should get over.
The margins for the company were low in Q1 and lower in Q2, around 700-750 basis points in all. The year on year margins for the quarter were down to 17.5 percent from 24.1 percent. Jiwani said margins were impacted because of volumes and GST but see them bottom out at these levels.
The major pressure on margins was mainly due to raw material costs, which was about Rs 36000 per candy last year went up to Rs 44000-45000/candy this year but has again come down to around Rs 38000/candy.Talking about the class-action suit with Target Corp, he said the discovery process was going on.