India’s Shoppers Stop posts third straight fall in quarterly profit

BENGALURU (Reuters) – India’s Shoppers Stop reported a third consecutive fall in quarterly profit on Thursday as consumers spent less on clothes and cosmetics amid elevated prices. Net profit fell 41% to 368.5 million rupees ($4.43 million) in the three months ended Dec. 31, the department store operator said in an exchange filing. India’s inflation was on the higher side during the quarter, largely driven by a spike in food prices, which resulted in people cutting back spending on discretionary items such as clothing and footwear.

The company, which houses products ranging from Vero Moda clothing to Michael Kors watches, said total expenses rose nearly 11%, outpacing a 9% growth in revenue to 12.38 billion rupees.

This led to a contraction in the margin on earnings before interest, tax, depreciation and amortization (EBITDA) to 6.9% from 10.2% a year earlier. The company is set to open 14 stores in the fourth quarter, it said. It currently operates a total of 105 department stores across the country.

Shares of Shoppers Stop closed 1.9% higher ahead of the results. They rose 0.8% in the December quarter.

Peers such as Arvind Fashions, Tata Group-owned Trent and Aditya Birla Fashion and Retail are expected to report quarterly results in February.

($1 = 83.1140 Indian rupees)

(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Sonia Cheema)