Textile manufacturer Arvind Ltd posted a 40 per cent drop in profit after tax for the first quarter for the current financial year 2024-25. The company said an “illegal” worker’s unrest caused a ₹200 crore impact on its revenue during the quarter.

The company reported a first quarter profit of ₹39 crore, down from ₹65 crore clocked during the same period in 2023-24. The revenues also slipped slightly by one percent to ₹1851 crore during the April-June quarter.

In a statement, Arvind stated, “The financial performance and growth of Arvind Limited in Q1 of FY25 were impacted by two unrelated events: the National general election and an illegal worker’s unrest. The unrest impaired the performance at the Santej factory, our largest textile facility (near Ahmedabad), for 21 days. As previously reported, the strike has been called off, and workers have gradually resumed duty, restoring normalcy to our operations.”

“The strike affected our main businesses, including the Woven segment, Denim segment, and the Industrial and Human Protection parts of the AMD segment. This resulted in capacity loss and challenges in executing existing orders. The strike had an approximate impact of ₹200 Cr on revenue and ₹60 Cr on EBITDA, including about ₹11 Cr in increased costs such as air freight and additional worker costs incurred to mitigate the strike’s effects,” the statement added.

Arvind also stated that its AMD division experienced partial impacts from the strike, particularly affecting the Human Protection subsegment, which relies on the woven segment for its fabric requirements.

“Additionally, it is important to note that the election season has led to the deferment of orders in some segments, such as Mass Transport, which depends on order flow from PSU customers. These deferments have resulted in lower operational and financial performance. However, the outlook for the subsequent nine months is better than expected,” the company added.

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