Welspun India, part of the $3.5 billion Welspun Group announced Q1 FY14 results, showing strong growth in profitability compared to the same period last year. In spite of an increase in raw material costs by five per cent, increased operational efficiency and lower power costs contributed to an improvement in EBITDA margin to 23.6 per cent as compared to 17.5 per cent in Q1 FY13. Welspun India’s vertical integration project to increase spinning and weaving capacity is on schedule and expected to be completed by the end of financial year ’14. In April, 2013, the company’s subsidiary, Welspun Captive Power Generation, commissioned a thermal power plant at Anjar. Apart from ensuring quality, and availability of key intermediate products such as yarn and fabric, the backward integration will contribute to improve the profitability of Welspun significantly. 

Profit after tax stood at Rs 899 million as compared to Rs 514 million in Q1 FY13 showing a significant improvement YoY. The net worth, which was impacted by a decrease in Hedging Reserve of Rs 1,364 million, stands at Rs 9,311 million. Excluding the hedging reserve, net worth would have been Rs 10,353 million as against Rs 9,580 million as of March, 31, 2013. 

The vertical integration project, once completed, will lead to further improvement in profitability. The captive power plant is ramping up generation, thus lowering power costs further and contributing to better profitability. The company will continue its focus on innovation, strengthening customer relationships and improving supply chain efficiency which will help it become the top home textile company in the world. With a distribution network in 32 countries and manufacturing facilities in India, Welspun is the largest exporter of home textile products from India.