Grasim Industries' Q2 Net Profit Jumps 50% To Rs 846 Crore
New Delhi: Aditya Birla Group firm Grasim Industries Ltd today posted 50 per cent rise in consolidated net profit at Rs 845.96 crore for the quarter ended September 30, supported by higher operating leverage and lower interest cost.
The company had posted consolidated net profit of Rs 562.48 crore in the corresponding quarter of previous fiscal, Grasim Industries Ltd said in a filing to BSE.
Its consolidated total income from operations also increased to Rs 9,356.42 crore in the July-September quarter as against Rs 9,107.02 crore during the same quarter of previous financial year.
"During the previous year, pursuant to the court approved Scheme of Amalgamation, Aditya Birla Chemicals Ltd (ABCIL) has been amalgamated with the company w.e.f the appointed date of April 1, 2015. Hence, previous year figures include the results of erstwhile ABCIL," it said.
In a statement, the company said: "Grasim has reported consolidated revenue of Rs 8,387 crore during the second quarter of FY17. Its EBITDA of Rs 2,098 crore was up by 29 per cent, driven by the good performance from all the businesses."
"Net profit for the quarter increased by 50 per cent to Rs 846 crore compared to Rs 562 crore in Q2 last year," it said.
The company further said its board today approved Dividend Distribution Policy for the firm as per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The objective of this policy is to provide dividend distribution framework to the stakeholders of the company.
It also informed that the process of seeking requisite regulatory approvals for the scheme of merger of Aditya Birla Nuvo with Grasim and subsequent demerger and listing of the financial services business is in progress.
"The transaction is expected to be completed by Q4 FY17-Q1 FY18," the statement said.
In the viscose staple fibre (VSF) business, steady demand globally coupled with high capacity utilisation and low inventory levels led to increased prices in the international market.
In the chemical business, sales volume was up by 8 per cent y-o-y, mainly on account of additional volume from the Ganjam plant which was acquired in September 2015.
The outlook for the VSF business is expected to remain stable. The company will continue to focus on expanding the VSF market in India by partnering with the textile value chain, achieving better customer connect through brand 'Liva' and enriching the product mix through a larger share of specialty fibre.
The company is working on debottlenecking opportunities to meet growing demand.
The demand for caustic in India is expected to grow with the rising demand from the end user industry. The commissioning of new capacities in the industry may increase supply in the medium-term, it said.
"Our plan is to increase caustic capacity...through brown field expansion at Vilayat (Gujarat) and debottlenecking at other plants is on track," it added.
The government's thrust on developing infrastructure spending, good monsoon, development of smart cities leading to growth in housing demand in tier I and tier II cities augurs well for the cement industry.
"The slower pace of new capacity addition will lead to better industry utilisation. UltraTech will benefit with its presence across the country to meet the expected rise in demand," it said.
Grasim is well poised to reap the benefit of investments in the growth plans of its businesses with the sustained growth in the Indian economy, it further said.
During the quarter, measures aimed at increasing liquidity in the company's equity shares were undertaken.
The measures taken include "sub-division of equity shares from one equity share of face value of Rs 10 each fully paid up to five equity shares of face value of Rs 2 each fully paid up, effective from October 8, 2016."
"Increase in the investment limit for Registered Foreign Portfolio Investors/Foreign Institutional Investors from the currently approved limit of 24 per cent to 30 per cent of the company's equity share capital was approved by the shareholders in extraordinary general meeting held on October 10, 2016," it said.
The increase will be effective post approval from Reserve Bank of India.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
