(Corrects story published on Feb. 10 to say company reported a group loss in first and second paragraphs.)
Feb. 10 (Bloomberg) -- Pantaloon Retail India Ltd., the country’s largest retail company, reported a second-quarter loss as interest costs increased.
The net loss was 79.6 million rupees ($1.6 million) in the three months ended Dec. 31, compared with a 124 million-rupee profit a year earlier, the Mumbai-based company said in a statement to stock exchanges today. The median of nine analyst estimates compiled by Bloomberg was a profit of 442 million rupees.
“Retail companies in India have had sluggish performance because of the slowdown in the economy, restrained purchasing power, and higher inflation and interest rates,” Paras Bothra, head of research at Ashika Stock Broking Ltd. in Kolkata, said before the announcement.
Pantaloon has been hurt by rising borrowing costs after the Reserve Bank of India increased key interest rates by a record amount from 2010 until October last year to fight inflation. The nation’s economy is expected to grow at the slowest pace since 2009, prompting consumers to spend less.
The government on Feb. 7 predicted economic growth of 6.9 percent this year after Asia’s third-largest economy expanded 8.4 percent in 2010-2011.
Pantaloon’s shares fell 3.5 percent to 189.55 rupees in Mumbai today. The earnings were announced after close of markets. The retailer has gained 47 percent this year, compared with a 15 percent advance in the BSE India Sensitive Index.
Net sales grew 3.7 percent to 31.7 billion rupees. Interest costs expanded 63 percent to 2.4 billion rupees, according to the statement.
--Editors: Abhay Singh, Sam Nagarajan
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