GST destocking drags Eveready Industries Q1 net down 39% to Rs 13.56 cr

This was particularly due to a general trend of de-stocking in the trade channels, the company said

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Eveready Industries Monday reported 39.36 per cent decline in standalone net profit to Rs 13.56 crore for the first quarter ended June 30, hit by de-stocking in trade channels ahead of GST implementation.

The company had posted a standalone net profit of Rs 22.36 crore in the same quarter previous financial year, Eveready Industries said in a BSE filing.

Revenue from operations during the period under review was at Rs 357.66 crore as against Rs 371.79 crore in the same period last financial year, down 3.8 per cent.

The inferior first quarter performance was due to market conditions being impacted in the run-up to the implementation of GST, particularly due to a general trend of de-stocking in the trade channels, the company said.

The impact was felt most prominently in the battery segment, which the company has more than 50 per cent market share, it added.

De-stocking by trade channels translated to "a severe 10 per cent drop in volumes", Eveready Industries said.

On the outlook, the company said post GST transition there is a pick-up in demand.

"Once all apprehensions relating to the new tax regime is put to rest, demand is expected to return to normalcy by the second quarter," it said.

Shares of Eveready Industries were trading at Rs 305.10 apiece in the afternoon trade, up 0.69 per cent from the previous close on BSE.