Grindwell Norton surges 9%, hits record high on strong Q4 results

In the past one week, the stock has outperformed the market by gaining 24 per cent, as compared to 1.5 per cent rise in the S&P BSE Sensex

Shares of Grindwell Norton (GNL) rallied 9 per cent and hit a record high of Rs 1,142.45 on the BSE in intra-day trade on Monday after the company reported a robust set of March quarter (Q4FY21) numbers across all operational parameters.

The stock surpassed its previous high of Rs 1,065.60, hit on May 7. In the past one week, it has outperformed the market by gaining 24 per cent, as compared to 1.5 per cent rise in the S&P BSE Sensex.

The company’s consolidated net profit grew 41.8 per cent year on year (YoY) to Rs 80.6 crore, on the back of higher revenue, partly aided by higher other income, which grew 28.6 per cent to Rs 12.4 crore, on a YoY basis. Revenues rose 39.1 per cent YoY at Rs 508.80 crore, primarily aided by a strong performance in ceramics & plastic segment. Overall, earnings before interest, taxes, depreciation, and amortization (EBITDA) margins came in at 22.2 per cent, which improved significantly by 570 basis points YoY.

The board of directors has recommended a dividend of Rs 9.50 per equity share (190 per cent) of Rs 5 each for the financial year 2020-21.

Overall, GNL has registered a strong set of numbers with better product mix and demand led by plastics & ceramics segment. Going forward, accelerated growth in plastics segment is expected to continue owing to niche value added products in life sciences and focus on export of niche high value products. Also, a revival in industrial/automotive, engineering activities would gradually provide further growth opportunities for abrasive, ceramics segments driving the overall performance in the long term, ICICI Securities said in a note.

GNL’s businesses include: abrasives, ceramic materials businesses (silicon carbide and performance ceramics & refractories), performance plastics and ADFORS.