Mumbai: India’s third biggest cement maker that also produces viscose-staple fibre Grasim Industries Ltd posted a bigger than-expected 34% gain in its fiscal third quarter profit, helped by higher yarn prices.
Net income rose to Rs554 crore ($140 million) in the three months ended 31 December from Rs412 crore a year earlier, the company said in a statement on Tuesday. Seven analysts surveyed by Bloomberg had a median profit estimate of Rs513 crore.
Sales rose 15% to Rs2,630 crore. Rising international prices of viscose-staple fibre helped Grasim to counter high fuel and freight costs at its cement division.
Grasim shares have declined 1.2% in the last 12 months, compared with a 35% drop at ACC Ltd and 21% fall at Ambuja Cement Ltd, the two Indian units of the world’s second biggest cement maker Holcim Ltd.
The fibre division makes up 31% of Grasim’s total revenue. Viscose-staple fibre prices rose more than one-fifth to Rs109,000 a tonne in the quarter, compared with an 11% jump in cement expenses, Kamlesh Bagmar, an analyst with Prabhudas Lilladher Pvt. Ltd, said.
Shares of Grasim fell Rs165.2, or 5.5%, to Rs2,859.7 on the Bombay Stock Exchange.