Grasim Industries Q2 Results: Profit rises 15% YoY to Rs 1,164 crore

Grasim Industries on Monday reported a 15% growth in its consolidated net profit at Rs 1,164 crore for the September 2023 quarter, compared with Rs 1,009 crore in the year-ago period.

Revenue from operations in the reporting period rose 10% to Rs 30,221 crore against Rs 27,486 crore in the corresponding period of the previous year.

The revenue growth was driven by the performance of key subsidiaries — UltraTech Cement and Aditya Birla Capital. However, softening of realisations in Caustic Soda impacted the standalone performance.

The company posted an EBITDA of Rs 4,509 crore in the July-September period, up 19% YoY from Rs 3,783 crore in the previous year period.

Segment-wise, in the viscose business, China operating rates (OR) averaged 85% in the second quarter, a slight increase compared to 82% in the preceding June quarter.

Additionally, the inventory levels have seen a gradual decrease during Q2. Domestic prices remained under pressure due to the softening of international VSF prices by 7% from an average of $1.67 per kg in the first quarter to $1.55 per kg in the second quarter.

International Caustic Soda spot prices remained relatively stable at 417 per ton in the second quarter. Caustic soda sales volume increased 3% year-on-year to 306KT in Q2FY24. ECU for the quarter stood at Rs 32,008/MT, down 35% year-on-year. Chemicals business revenue stood at Rs 1,988 crore, showing a decline of 27% YoY, primarily due to lower caustic soda realisations.

EBITDA for the chemicals segment dropped 61% year-on-year to Rs 236 crore. Speciality chemicals (epoxy polymers and curing agents) business margins were impacted by lower realisations as compared to the first quarter.

The total capex outlay for the second quarter stood at Rs 1,650 crore, of which Rs 1,269 crore was for the paints business.

The Board has approved capex of Rs 144 crore for different businesses and has also gave nod to rephasing of spending of earlier approved Capex entailing additional spend of Rs 138 crore in the current fiscal. The budgeted spend for FY24 stands revised at Rs 5,929 crore.

On Monday, Grasim shares closed 1.24% lower at Rs 1,922 on NSE.

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