Lingerie makers report decline in net profit in December quarter

Women's innerwear-manufacturer Loveable Lingerie reported a dip in standalone net profit for the third quarter ended December 2015 due to a 11 percent increase in operating expenses, even as income from operations rose 13 percent.

Net profit of the Mumbai-based company was Rs 3.39 crore, down 10.78 percent from Rs 3.80 crore during the corresponding quarter last fiscal, while income went up 13.09 percent to Rs 46.90 crore from Rs 41.47 crore, YoY, according to the company's regulatory filing to the BSE.

Operating expenses climbed 11.23 percent to Rs 42.67 crore, resulting in a fall in net profit.

There has been steady decline in income over the past few quarters, from Rs 48.06 crore in the September quarter and Rs 65.51 crore for the quarter ended June 2015.

The Lovable Lingerie stock declined 4.32 percent on Friday and closed at Rs 214.90.

The company acquired the brand "Lovable" from Lovable World Trading Company, USA, in 2000 to sell women's innerwear India, Nepal and Bhutan.

Its three units (two in Bengaluru and one in Roorkee) have a combined capacity to make 67.5 lakh brassiere and panties per annum.

The company's website says it is planning to set up a third unit in Bengaluru with an installed capacity to manufacture 25 lakh pieces annually.

Its annual report for FY2015 quotes a study to say that women's innerwear market is expected to grow to Rs 21,880 crore by 2018.

Maxwell Industries, another player in the business that makes innerwear for both men and women, reported net loss of Rs 7.06 crore for the December quarter in contrast to Rs 2.21 crore profit for the year-ago period due to a 23 percent fall in sales at Rs 48.36 crore. The company's sales for the corresponding period stood at Rs 62.82 crore. 

The stock closed at Rs 38 on Friday on the BSE, down 1.43 percent.

Sales have been rising for lingerie start-ups such as Zivame, which are cashing on the "awkwardness many middle-class women feel buying underwear in public" in India.

Zivame's sales have gone five-fold since the portal was founded in August 2011 by Richa Kar and Kapil Karekar, and its valuation was $110 million after it received $40 million in funding from local and foreign investors in September 2015, Reuters had reported.