Why Did Welspun Living’s Q1 Net Profit Plummet by 52%?
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Synopsis
Welspun Living Limited has reported a staggering 52% year-on-year decline in its net profit for Q1 FY26, raising concerns about its export operations and profit margins. This report delves into the reasons behind this significant downturn and its implications for the future of this home textiles giant.
Key Takeaways
- 52% YoY decline in net profit for Q1 FY26.
- Revenue from operations fell 11%.
- Operating profit (EBITDA) dropped 34%.
- Domestic consumer business saw a 9.5% growth.
- Net debt decreased to Rs 1,401 crore.
Mumbai, July 30 (NationPress) Home textiles manufacturer Welspun Living Limited announced a significant 52% year-on-year (YoY) drop in net profit for the quarter that ended on June 30 (Q1 FY26). The company achieved a profit of Rs 89.3 crore, down from Rs 186 crore during the same period last year, primarily due to reduced exports and weakened margins impacting earnings.
Revenue from operations declined by 11% to Rs 2,261 crore from Rs 2,536 crore a year prior.
Operating profit (EBITDA) saw a 34% decrease, falling to Rs 226 crore from Rs 341 crore in the corresponding quarter of the previous year, with margins slipping to 10% from 13.45%.
Welspun’s home textile exports business experienced an 11.8% drop in revenue, reporting an EBITDA margin of 12.6%.
In the advanced textile segment, a 11.6% YoY decline was noted. Conversely, the domestic consumer segment achieved a 9.5% growth, bolstered by a 2.5% rise in domestic home textiles and a robust 26% increase in domestic flooring sales.
The overall flooring business generated Rs 193.5 crore in revenue, yielding an EBITDA of Rs 16.2 crore and a margin of 8.4%.
Net debt decreased to Rs 1,401 crore from Rs 1,562 crore in June 2024, as per its stock exchange filings.
On the Bombay Stock Exchange (BSE), shares of Welspun Living closed at Rs 131.40, down Rs 4.70 or 3.45% from the previous close.
Welspun Living Limited is a prominent home textile company, specializing in the production and supply of items such as towels, bed sheets, and rugs.
Part of the $2.7 billion Welspun Group, it caters to both businesses (B2B) and direct consumers (B2C).
In addition to traditional home textiles, the company also offers flooring solutions and advanced textiles, maintaining a presence in e-commerce, hospitality, and wellness sectors.
Point of View
I present an unbiased perspective on Welspun Living's recent financial challenges. The substantial drop in net profit highlights the pressing issues facing the home textiles industry, particularly in exports. It's crucial for stakeholders to closely monitor these developments and strategize accordingly to navigate the evolving market landscape.
NationPress
31/07/2025
Frequently Asked Questions
What caused the decline in Welspun Living's profit?
The decline was primarily due to lower exports and weakened margins impacting earnings, leading to a 52% year-on-year drop in net profit.
How did the revenue from operations change?
Revenue from operations fell by 11% to Rs 2,261 crore compared to Rs 2,536 crore a year earlier.
What is the current status of Welspun Living's debt?
Welspun Living's net debt has reduced to Rs 1,401 crore from Rs 1,562 crore in June 2024.
