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Shares of Dollar Industries fell as much as 6.6 percent on Friday after the company reported a 12.5 percent decline in revenue for the September quarter compared to last year.

Consolidated revenue fell to Rs 342 crore from Rs 391 crore during the same period last year.

The management attributed this performance to weakness in the Indian hosiery sector which is bearing the brunt of price volatility across input materials like cotton and yarn. The continuous correction in the prices of cotton and yarn resulted in substantial inventory losses for the company during the quarter.

Net profit for the period declined 56 percent year-on-year while EBITDA halved.

However, the management says that the inventory losses are temporary in nature and appear to have come to and end with cotton and yarn prices now stable.

The company also said that contribution from their "Project Lakshya" initiative doubled during the quarter. For the first six months of the current financial year, Project Lakshya has contributed to 16 percent of revenue compared to 8 percent in the entire financial year 2022.

Project Lakshya is an initiative from Dollar Industries to spread its product range in the market and increase its point of sales.

Domestic sales for Dollar Industries grew 10 percent in volume terms while modern trade and e-commerce grew 67 percent on a six-month basis.

The company currently has eight executive brand outlets and plans to open 20-25 such stores by the end of the current financial year.

Shares of Dollar Industries are trading 6.4 percent lower at Rs 453.35.