Despite a surge in consumer demand for home linen products during the festive season, Indian textile giant Trident witnessed a disappointing third quarter, The company's profit nosedived by nearly 25 per cent to Rs 1.09 billion, highlighting the challenge of rising expenses even amidst market growth.
While sales during the quarter grew by 12 per cent to Rs 18.35 billion, expenses ballooned by 16 per cent, primarily driven by a 9 per cent increase in raw material costs like cotton. This surge in expenses overshadowed the positive sales figures, resulting in the significant profit drop.
Typically a period of high demand for home linen products like bedsheets and towels, the festive season, saw a positive sales trend for Trident. However, this growth was insufficient to offset the escalating expenses, leaving the company's bottom line under pressure.
Despite the profit decline, the underlying market for home linen and textile products remains promising. This presents Trident with an opportunity to recover, but requires strategic cost management measures.
The company is implementing various initiatives to control expenses. These include actively negotiating with raw material suppliers to secure better pricing and explore alternative sourcing options; undertaking internal restructuring to optimise production processes and reduce overhead costs, and prioritising production and marketing of higher-margin products within its portfolio to improve profitability.