HP Cotton Textiles Q2 FY24, net sales rise, profit declines sharply

HP Cotton Textiles reported consolidated net sales of Rs 33.74 crore for Q2 FY24, a significant 50.02 per cent increase from Rs 22.49 crore in Q2 FY23. However, quarterly net profit dropped sharply by 84.46 per cent to Rs 0.83 crore, compared to Rs 5.34 crore a year ago.

EBITDA grew 26.47 per cent to Rs 4.30 crore in Q2 FY24, up from Rs 3.40 crore in the same quarter last year. The company's EPS declined to Rs 2.14 in September 2024 from Rs 13.66 in September 2023, reflecting the impact on profitability. Despite improved revenue, increased raw material costs, higher employee expenses, and reduced other income weighed on the company's margins. The company's shares closed at Rs 119.90 on November 22, 2024, registering a 5.96 per cent loss over six months and a 22.42 per cent dip over the past year.

HP Cotton Textiles' operational expenditure, including raw material costs and employee expenses, rose considerably, contributing to the profit decline. Interest expenses remained steady at Rs 1.68 crore. The contrasting revenue growth and profit slump highlight challenges in cost management, despite stronger sales performance in Q2 FY24.