Birla Corp posts Rs 56.4-crore net loss in Q2, appoints new MD & CEO

MP Birla group flagship, Birla Corporation, posted a consolidated net loss of Rs Rs 56.46 crore in the July-September quarter on the back of cost escalation. The company had recorded a net profit of Rs 85.55 crore in the year-ago period.

The company said profitability was impaired by a sharp increase in power and fuel costs, which could not be passed on to consumers in the seasonally weak monsoon quarter. Overall cement production cost in the September quarter was up 20 per cent year-on-year and 5 per cent sequentially.

The net loss, the company said, was after several years. The bottomline was also impacted by higher interest and depreciation costs on account of the Mukutban unit in Maharashtra, which was set up at an investment of Rs 2,744 crore.

The 3.9 million tonne (mt) unit started commercial production in April and augmented the company’s production capacity to 20 mt. In the current financial year, the Mukutban plant is expected to produce around 1 mt of cement.

Birla Corporation clocked in an 11.4 per cent increase in sales volume in Q2FY23 at 3.64 mt. Total income in Q2 stood at Rs 2,041.58 crore, up 19.3 per cent from the year-ago period.

Leadership change

The Birla Corporation board on Tuesday approved the appointment of Sandip Ghose as the company’s whole-time director from December 1 to December 31, 2022, and as the managing director and chief executive officer effective January 1, 2023, for a period of three years, subject to the approval of shareholders. The company informed that Arvind Pathak was stepping down as managing director and chief executive officer due to personal reasons. Pathak, the company said, was instrumental in charting a road map for aggressive growth and took multiple initiatives to improve efficiency.