Indian garment and textile maker Arvind Mills believes the global textile market has shown signs of recovery this year, helping the company to a six-fold hike in third quarter profit.

Arvind posted a third quarter net profit of INR480m (US$10.5m), up by 611% on the same period last year.

"We have been seeing recovery in the textile market as well as the brand and retail market for the last 6-12 months," Arvind CFO Jayesh Shah tells just-style.

Revenues for the period rose 22% to INR10bn, Arvind said yesterday (28 January). Much of Arvind's growth has been possible through domestic sales, further boosted by the creation of its own brands and retail operations in India.

Shah adds: "The Indian domestic market is very critical for us. In Q3, 72% of our revenue came from the Indian market and we see this ratio improving. Additionally, our brands and retail business, which is growing at an annual rate of 51% during the current fiscal year, is entirely India focused."

Arvind's branded offering makes up around 23% of its total revenue, meaning that textiles are still the heartbeat of this 80-year old manufacturer.

However, the growth of brands and retail is outstripping textiles and suggests that the emergence of India's consumer market is central to profit growth.

The company was not immune to industry pressures in the third quarter either, telling just-style it saw cotton prices more than double last year. Shah says that like other textile firms, Arvind has increased fabric prices to "take care" of such cost pressures.

In a third quarter presentation sent to just-style, the company outlines that textile revenues still grew 17% during the period - led by 39% growth in denim and 22% growth in shirting. Both categories are working at near-capacity too.

Nevertheless, Arvind says that margins remain unchanged as the sharp rise in raw material costs negatively offset rising revenues.

Arvind's latest results indicate how rising costs are impacting textile production, and stand to undermine the industry's fragile recovery.