Grasim Industries Ltd.: Grasim Industries Q4 results: Profit grows 32% to Rs 1,506 crore

Mumbai: Grasim Industries, the Aditya Birla Group flagship with businesses ranging from cement to chemicals, reported a 32% growth in consolidated profits during the March quarter and a 161% growth for the full fiscal FY20 aided by write back of deferred tax liabilities and lower exceptional charges.

Consolidated profit after tax for Q4 FY20 stood at Rs 1,506 crores against Rs 1,144 crore in the year ago period. Revenue, however declined by 11% to Rs 19,902 crores. Earnings before interest, tax, depreciation & amortisation (Ebitda) declined 19% to Rs 3,243 crore.

For the full financial year, profit came in at Rs 4,425 crore while revenue grew by 0.5% to Rs 77,625 crore. Ebitda grew by 3% to Rs 13,846 crore.

In the near term, the demand of the company’s products will be impacted by the COVID-19 led general economic slowdown. The company has initiated measures to reduce its fixed costs and conserve cash as part of its comprehensive business continuity plan, the company said.

Grasim’s fabric business, Viscose Staple Fibre recorded a sales volume of 554 kilo tonne in FY20, a growth of 2.4%, despite a decline of 18% YoY in the month of March’20 on account of nationwide lockdown. Production and sales volume of VSF business were sustained at 131kt and 136kt respectively during Q4FY20.

Grasim’s Chemicals business registered a sales volume of 991kt of caustic soda. The Caustic Soda production and sales volume for Q4 FY20 stood at 250kt and 252kt respectively.

“Global caustic soda prices softened during the quarter. The domestic realisation was impacted by weak industry demand, surge in imports and ramping up of new capacities,” the company said.

The company has been in the process of executing total capex plan of around Rs 7,800 crores at a standalone level for raising capacities in both the VSF and Chemical businesses.

“The capex plans are currently being reviewed, in the context of the current economic environment,” the company said.

Company’s cement subsidiary, UltraTech Cement reported a consolidated revenue of Rs 10,746 crores and consolidated sales volume of 21.44 million tonnes.

UltraTech in 2018 acquired Century Textile’s cement business and the reorganisation was to bring UltraTech a get ready ownership of 13.4 million capacity spread across Madhya Pradesh, Chhattisgarh and Maharashtra.

“The acquired plants from Century ramped up production touching a capacity utilization of 80% in March-20. Brand integration is underway, 65% of sales from the acquired Century plants during the quarter were under the UltraTech brand, which is expected to reach more than 80% by Q3FY21,” the company said.

Grasim’s financial services business, Aditya Birla Capital’s revenue and net profit in FY20 stood at Rs 16,792 crores. In life insurance business total gross premium was up 7% to Rs 8,010 crores and in health insurance business the gross written premium increased by 76% to Rs 872 crores during the complete fiscal year.

Consequent to the national lockdown across country, all operations of Grasim were suspended except at the fertilizer plant in Jagdishpur (UP). Operations have since partially resumed across business with capacity utilisation levels from 25% – 100%, the company said.

[Source – Economic Times]


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