Aditya Birla Nuvo profit declines 12% to Rs283 crore
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Mumbai: Aditya Birla Nuvo Ltd (ABNL), part of Aditya Birla Group, on Thursday posted a 12% decline in net profit to Rs283 crore in the quarter ended 30 September, mainly due to lower profits from mobile-phone services provider Idea Cellular Ltd, a unit of the company.
Revenue rose 9.4% from a year ago to Rs3,593 crore, the company said in a filing to the BSE.
ABNL said its net profit had declined on a year-on-year “due to reduction of ABNL’s share in Idea’s net profit by Rs156 crore.” During the reporting quarter, net profit of Idea Cellular declined from Rs762 crore to Rs91 crore mainly on account of higher interest and amortization costs pertaining to the spectrum acquired in earlier years.
ABNL also said the share of profit of associate and joint ventures had declined to Rs54 crore as from Rs209.35 crore a year ago.
On 11 August, the company’s board of directors approved a composite scheme of arrangement between the company, its wholly owned subsidiary Aditya Birla Financial Services Ltd (ABFSL), Grasim Industries (Grasim) and their respective shareholders and creditors.
As part of the arrangement, the Kumar Mangalam Birla-led Aditya Birla Group will merge Aditya Birla Nuvo and Grasim Industries in an attempt to create a stronger entity, and unlock shareholder value by spinning off and listing one of Nuvo’s subsidiaries, Aditya Birla Financial Services Ltd.
The group said that the process of seeking requisite approvals for merging ABNL with Grasim and the subsequent demerger and listing of the financial services in progress. “The transaction is expected to be completed in the first half of the calendar year 2017,” it said in the filing.
During the quarter, Aditya Birla Financial Services’s business grew by 29% to Rs2,535 crore and earnings before tax expanded by 66% to Rs348 crore while Idea Cellular’s revenue increased 7% to Rs9,300 crore.