Rupa & Company shares slide 28% in 2 straight sessions after disappointing Q4 results, CEOs exit
Shares of Rupa & Company Limited slipped almost 28 per cent on the BSE over the past two trading sessions after the company reported disappointing March quarter results on higher raw material costs.
Shares of Rupa & Company Limited slipped almost 28 per cent on the BSE over the past two trading sessions after the company reported disappointing March quarter results on higher raw material costs.
On Wednesday, the stock closed over 11 per cent lower to Rs 381.95 per share on the BSE as against a 0.56 per cent rise in the S&P BSE Sensex. The stock has corrected over 36 per cent from its 52-week high touched on May 4, 2022.
The company on Monday reported a 25 per cent year-on-year (YoY) fall in consolidated profit after tax (PAT) to Rs 49.3 crore, amid flat revenues at Rs 455.5 crore as compared to a year-ago quarter.
While its EBITDA (earnings before interest, taxes, depreciation, and amortization) dipped 18 per cent YoY at Rs 74.2 crores, while margins contracted 370 bps to 16.3 per cent from 20.0 per cent YoY.
The management in its earnings commentary said that the industry faced headwinds in the form of a COVID wave early in the quarter coupled with rising raw materials prices. The company incurred higher advertising and promotion expenses. Thus, a multitude of factors led to pressure on margins.
Apart from this, Dinesh Kumar Lodha's exit as the company's chief executive officer (CEO) also triggered the decline. The company CFO-Ramesh Agarwal, who is also a part of the promoter family, of Rupa & Company has also resigned.
“The company is actively looking for a suitable candidate to fill in the position of the CEO. Lodha is and will be an active part in this process of selecting the new CEO,” the garments and apparel company said.
Rupa & Company Limited is engaged in the manufacture of knitted apparel, including hosiery, it offers textile, leather, and other apparel products.
The company has an asset-light model by strategically outsourcing labour-intensive work in manufacturing processes and focused on value addition, product differentiation, branding, and distribution.
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