MUMBAI, Jan 31 (Reuters) - Textiles firm Mandhana Industries expects operating margins to rise to by 1 percentage point to 18.5-19 percent in the March quarter due to high exports and better economies of scale, a senior official said on Monday.
The company's operating profit margin fell to 17.5 percent in the quarter to December from 20.1 percent a year ago on higher yarn prices as cost of cotton - a key raw material - soared to record high, Mitesh Shah, vice-president of finance, told Reuters over the telephone.
Prices of cotton hit a 150-year high last week, spurred by tight supplies in the United States and in China. [ID:nN24363929]
(Graph on U.S. and Chinese cotton market: http://r.reuters.com/gen67r)
The firm, which has clients like Tommy Hilfiger and French Connection and domestic retailers such as Pantaloon Retail and ITC , is likely to export 1.6 billion rupees worth of garments in FY11, Shah said, adding exports may nearly double to 3 billion rupees in FY12. (Reporting by Swati Pandey; Editing by Rajesh Pandathil)