Raymond Ltd Q3 Results: Profit Slides 90%, Margins Show Improvement

Raymond Ltd reported its December-quarter results, with consolidated net profit falling sharply even as revenue and operating profit increased. What drove the net profit decline despite higher revenue and EBITDA?

The company posted a net profit of ₹7 crore for the third quarter, down 90.3% from ₹72.3 crore in the same period last year. Revenue from operations rose 19.6% year-on-year to ₹557.2 crore, compared with ₹466 crore a year earlier.

Earnings before interest, tax, depreciation and amortisation stood at ₹60 crore for the quarter, up from ₹38.8 crore a year ago.

EBITDA margin for the period was 10.8%, compared with 8.3% in the corresponding quarter last year. The numbers show operating profitability improved even as reported profit fell sharply, with revenue growth remaining intact and the margin expansion continuing from the prior year. The gap between operating profit and net profit will be a point of focus in the next quarter’s filing.

Why did net profit fall even as EBITDA rose sequentially?

On a sequential basis, EBITDA increased to ₹271 crore in the December quarter from ₹259 crore reported in the September quarter. The company recorded a deferred tax outflow of ₹137 crore during the quarter, which weighed on reported profit. Employee benefit expenses rose quarter-on-quarter to ₹238.7 crore, compared with ₹226.5 crore in the previous quarter.

Net profit margin declined to 3.37% from 4.47% in the September quarter. Earnings per share fell to ₹7.04 during the quarter, compared with ₹12.34 reported in Q2. The garmenting segment recorded a 17% year-on-year decline during the quarter, with the company citing export-related challenges and uncertainty around US tariffs in its disclosure.

How did Raymond Lifestyle perform over the nine-month period?

For the nine-month period ended December, Raymond Lifestyle reported consolidated revenue of ₹5,111 crore, compared with ₹4,683 crore in the corresponding period last year, marking a 9.2% increase. Net profit for the period rose 18% year-on-year to ₹982 crore, as per the company’s disclosure.

EBITDA for the nine-month period stood at ₹652 crore, with margins reported at 12.5%, unchanged from the level recorded earlier. The company reported a net debt position of ₹15 crore at the end of December, reflecting its balance sheet position during the period.

Conclusion

The key takeaway for investors is the shift in what is driving reported earnings in the December quarter. With operating profit rising but net profit falling, the focus moves to statutory and tax-related items, and how these may recur or reverse in future quarters. Quarterly earnings will likely remain sensitive to such non-operating costs.

For Raymond Lifestyle, the nine-month performance suggests the company is carrying a low net debt position into the final quarter. That balance sheet position may shape investor attention on how the company manages working capital and capital allocation through the rest of the fiscal year, especially as broader market conditions remain uncertain.

Sources:

Freepressjournal

Businessupturn