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A screen grab of Grasim Industries website
A screen grab of Grasim Industries website

Grasim Q3 net profit rises 0.5% to Rs334 crore

Net profit for the third quarter of the fiscal rose to Rs334 crore from Rs332 crore in the year-ago quarter

Mumbai: Grasim Industries Ltd, part of the Aditya Birla group, on Saturday reported a 0.5% increase in net profit for the quarter ended 31 December on account of additional interest and depreciation charges on acquired assets.

Net profit for the third quarter of the fiscal rose to Rs334 crore from Rs332 crore in the year-ago quarter. On a like-to-like basis, which is excluding the results of the acquired assets, the profit grew 23% in the reporting period, the company said in a statement.

Revenue grew by 13% to Rs8036 crore, from Rs7117 crore in the same period last year.

A Bloomberg poll of six analysts had estimated Grasim’s net profit at Rs396.1 crore and revenue at Rs7644.7 crore.

The production of viscose staple fibre (VSF) at 105,834 tons has gone up by 15%, with commissioning of plant at Vilayat, Grasim said.

“Steep fall in the price of cotton and PSF led to further pricing pressure on VSF. This has resulted in lower profit before interest, depreciation and tax, (PBIDT), partially offset by higher share of value added products and lower pulp cost," it added.

In its chemical business, caustic soda production grew by 40% to 106,332 tons with the Vilayat Plant reaching 90% utilisation. With higher volumes, PBIDT was up by 16% at Rs67 crore, Grasim said.

In its outlook sector the company said, the VSF sector will continue to face head winds for some more time due to the over-capacity and sharp reduction in price of cotton and polyester.

“The slowdown in new capacity additions in China should lead to an improvement in industry utilization which augurs well for the Company. The focus on cost optimisation will continue relentlessly," Grasim added.

In cement, demand growth in the long term is likely to be over 8%, it said.

On Friday, shares of Grasim closed at Rs3882.05, down 1.20% on the BSE while the benchmark Sensex index fell 1.68% to close at 29,182.95 points.

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