Grasim posts 40% jump in net profit in March quarter

Records Rs 724 cr profit, revenue up by 13% at Rs 10,000 cr

Aditya Birla Group firm Grasim on Saturday reported a 40 per cent jump in net profit at Rs 724 crore for the March quarter as compared to Rs 516 crore in the same period last year.

"The revenue increased by 13 per cent at Rs 10,001 crore in the March quarter as against Rs 8,817 crore in the same period last year due to robust volume growth in VSF, chemicals and cement businesses," a company statement said.

For the full year, consolidated revenue was higher by 12 per cent to Rs 36,637 crore and net profit increased to Rs 2,387 crore as compared to Rs 1,753 crore last year.

The board of directors has recommended a higher dividend of Rs 22.5 per share as against Rs 18 per share in the previous year. The total outflow on account of the dividend will be Rs 221 crore, inclusive of the corporate tax on dividend. The viscose staple fibre (VSF) division's revenue increased by 23 per cent at Rs 1,729 crore. Sales volume grew by 10 per cent at 130,000 TPA (tonnes per annum) helped by additional volume from the Vilayat plant and concerted efforts towards market expansion, it said. The chemical division's revenue doubled to Rs 957 crore as against Rs 429 crore in the fourth quarter of 2014-15. Caustic soda volume at 204,000 tonnes was up by 95 per cent. Volumes in existing operations grew by 15 per cent.

The board approved Rs 513 crore for brownfield expansion of caustic soda capacity at the Vilayat plant from 219,000 TPA to 363,000 TPA along with a captive power plant of 44 MW.

The cement subsidiary, UltraTech Cement, has outpaced the industry with domestic volume growth of 15 per cent. Revenue for the quarter was Rs 6,920 crore as against Rs 6,595 crore in the fourth quarter last year. EBITDA was up by three per cent at Rs 1,478 crore, helped by enhanced volumes and lower fuel prices.

Net profit was Rs 723 crore as compared to Rs 657 crore in the corresponding quarter.

The company will continue to focus on expanding VSF market in India by partnering with the textile value chain and better customer connect through Brand Liva. Enhancing product mix through larger share of specialty fibre will be yet another focus area, it said.

The caustic soda demand in India is expected to grow. To meet the growing demand, caustic capacity is being raised by 100,000 TPA through debottlenecking at different units.

In cement, demand is expected to grow at seven-eight per cent for the next year, driven by the government's focus on infrastructure development, housing and smart cities, it said.