Home / Knowledge / News / Textiles / Hike in input costs hit Q2 net profits at LMW
Hike in input costs hit Q2 net profits at LMW
Nov '11
Despite, a 31 percent rise in sales and buoyed by a good off-take of textile machinery from the Northern parts of India, major textile machinery producer Lakshmi Machine Works (LMW) posted a marginal increase in fiscal 2011-12 second quarter net profits.

Despite the various challenges that the Indian textile sector is facing, income from operations at LMW rose by a massive 31 percent to Rs 5.61 billion from Rs 4.29 billion, year-on-year. However, net profits augmented by just 7.4 percent to Rs 492.4 million in the second quarter from Rs 458.5 million from a year ago.

Speaking exclusively to fibre2fashion, Mr R Rajendran, Director (Finance) LMW said, “Actually in the second quarter we could utilize our capacities according to what we had planned mainly on account of current execution of our product order. The product order that we had received during the year 2010-11 are all under execution.

“So that has helped us at least to utilize our capacities to the maximum extent. And of course, in the process we were able to increase the volume of sales compared to the previous quarter. Also compared to the first half of 2010-11, there is a growth of around 39 percent in the half year of current fiscal 2011-12.

“Our net sales have increased from Rs 7.53 billion to Rs 10.54 billion in the first half of 2011-12. But at the same time, gross and net profits have fallen on account of rise in input costs. The gross profit ratio has come down to 21 percent to 17 percent. Correspondingly net profit ratio has dropped from 15 percent to 12 percent during this period.

Informing about their major Indian markets, he said, “We have clients throughout India but mainly Andhra Pradesh and the North East regions are now our major buyers, since no new projects are coming up in Tamil Nadu. Mainly new projects including expansions are coming up in the northern parts of India and parts of Andhra Pradesh”.

“Out of total of about 42-43 million spindles installed in India, nearly 23 million spindles have been supplied by LMW. Which means we are the preferred choice of textile mills, due to which our order book position has also actually increased, compared to the previous year”.

Speaking about LMW's performance in the rest of the fiscal year, he informed, “As I mentioned earlier, we have orders on hand, which will stretch for the full current fiscal year as well as the next fiscal year. We expect to repeat our performance of the first half of current fiscal in the second half”.

Revealing their order book position he said, “At this juncture we are sitting on a very good order book, which stands at Rs 46 billion. The only challenge we are facing is that despite matured orders, textile mills are not taking deliveries. They are waiting for a good opportune moment to expand or create further capacities”.

Fibre2fashion News Desk - India

Must ReadView All

Courtesy: Commonwealth Bank of Australia

Textiles | On 25th Oct 2016

World’s first cotton shipment using Skuchain’s Brackets

The world’s first trade transaction involving shipment of cotton...

Textiles | On 25th Oct 2016

Cotton yield to increase to 568.29 kg/ha in 2016-17: CAB

At its first meeting for the cotton season 2016-17, the Cotton...

Apparel/Garments | On 25th Oct 2016

US most sought after market for UK retailers: Global-e

A majority of the retailers in the UK consider US to be their most...

Interviews View All

Karel Williams
Dow Microbial Control

'Silvadur is most rapidly adopted in areas where hygiene-conscious and...

Milind Khandwe
Hindoostan Innovation Centre

‘Modern technical textile is an indispensable tool for science and...

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Kerem Durdag
Biovation II LLC

Kerem Durdag, CEO, Biovation II LLC, provides an insight into future...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Pranav Mishra

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Igor Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

October 2016

October 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Advanced Search