Welspun India logs 65.56% yoy drop in Q1 PAT; to invest Rs495cr in advanced textile verticals

Total income for the period stood at Rs1,216.04cr, declining by 29.96% as against Rs1,736.29cr a year ago same period.

Jul 24, 2020 04:07 IST India Infoline News Service

Welspun India
Mumbai-based textile company, Welspun India on Friday registered a 65.56% drop in its consolidated net profit to Rs53.75cr during the June 2020 (Q1FY21) quarter, compared to Rs156.07cr in the similar quarter of the previous year. Meanwhile, total income for the period stood at Rs1,216.04cr, declining by 29.96% as against Rs1,736.29cr a year ago same period.

Welspun in a statement said, "As we had already updated during our Q4FY20 results, our plants were shut from last week of March to first half of April, due to government-imposed lockdown on account of COVID. However, we could swiftly restart our operations with all the safety protocols in place. We saw lower utilization of our capacities in April, but it improved in May and further picked up in June. This impacted the revenue and EBIDTA of the current quarter, which are down by 30% and 36% respectively from the corresponding quarter of the previous year. However, at present, our plants are running close to full capacities."

In a meeting held today, the company's board approved an investment of Rs495cr in Advanced Textile vertical through its wholly-owned subsidiary namely Welspun Advanced Materials India Limited (WAMIL) spread over 2 years. It is a planned Capex to augment our Spunlace, Wet wipes and bleached cotton capabilities.

On the new investment, Welspun said, "Given the current scenario and changing consumer behaviour towards health and hygiene, there is a high demand for PPE products as well as disposable solutions. Our current capacities are already fully utilized. We see huge potential with addressable market size estimated to be $80B.

On Sensex, Welspun stock ended at upper circuit limit of Rs36.20 per piece surging by 4.93%. 

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