CHENNAI/BENGALURU (Reuters) – India’s Shoppers Stop reported a 24% jump in quarterly profit on Monday, as the department store operator benefited from festive season sales and a pick up in demand for luxury products.
Wealthier shoppers have largely shrugged off the inflation squeeze to splurge on clothing and accessories as they returned to pre-pandemic lifestyles going to the office and attending typically extravagant Indian weddings, where families spend huge sums on ceremonies that last for days, involving hundreds of guests.
Shoppers Stop’s net profit rose to 620.6 million rupees ($7.63 million) for the quarter ended Dec. 31.
Revenue stood at 11.32 billion rupees, up nearly 19% from a year ago.
“Customer sentiments remain largely buoyant due to the prolonged festive and wedding season demand,” Venu Nair, managing director and chief executive of Shoppers Stop said in a statement.
“Product premiumization across private brand categories has resulted in the highest quarterly sales with a growth of 23%,” Nair said.
Retailers clock the bulk of their sales from late September to early November during the Hindu festival of Deepavali, when Indians spend heavily on clothes and gifts.
However, consumer spending has moderated since then, especially from lower-income customers in smaller cities and towns as they reel from the economic impact of high inflation.
The growth momentum tapered down a little after Deepavali, Nair said.
The company also plans to open five more department stores and four beauty stores in seven cities by the end of this fiscal year.
Shares in the Mumbai-based chain, which more than doubled last year, closed 1.5% lower at 667.35 rupees, ahead of the earnings report.
($1 = 81.3820 Indian rupees)
(Reporting by Praveen Paramasivam in Chennai and Anuran Sadhu and Nishit Navin in Bengaluru; Editing by Dhanya Ann Thoppil)
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