Spanish fashion brand Zara’s profit after tax (PAT) dropped 13.43 per cent to Rs. 71.49 crore in FY 2018-19, amidst increasing competition and a slowdown in consumer demand in the Indian market.
Inditex Trent Retail India Private Ltd (ITRIPL), an association of Tata group’s Trent, which operates Zara stores in India, had reported a PAT of Rs. 82.59 crore in FY 2017-18.
Meanwhile, the revenues of Zara were up 17.7 per cent at Rs. 1,438 crore, Trent Ltd. said in its annual report. For the year 2017-18, this was Rs. 1,221.67 crore.
ITRIPL is a 51:49 joint venture between Trent and Spanish firm Inditex SA, which owns several fashion brands including Zara. The JV also operates another label Massimo Dutti in India.
“The entity for Massimo Dutti operates three stores and recorded total revenue of Rs. 63.58 crore in FY19,” it said.
ITRIPL has added two more stores during the period and is currently operating 22 stores of Zara in Delhi, Mumbai, Bengaluru, Pune, Surat, Jaipur, Chandigarh, Chennai, Mohali, Hyderabad, Kolkata and Gurgaon.
“The incremental store opening programme for Zara continues to be calibrated,” it said.
In its annual report last year, Trent had asserted that while the firm plans to add more stores for Zara in India over the next three to four years, availability of high-quality real estate remained a challenge.