Grasim Inds Q3 PAT slides 40% YoY to Rs 1,514 cr

The Aditya Birla Group company's consolidated net profit declined 39.8% to Rs 1,514.44 crore in Q3 FY24 as against Rs 2,515.78 crore Q3 FY23.

However, revenue from operations rose 11.62% year on year (YoY) to Rs 31,965.48 crore in the quarter ended 31 December 2023.

Profit before tax was at Rs 3,471.74 crore in the December quarter, registering de-growth of 31.75% from Rs 5,086.66 crore in Q3 FY23.

EBITDA jumped 34% to Rs 5,150 crore in Q3 FY24 as against Rs 3,834 crore posted in Q3 FY23. EBITDA margin reduced to 16% in Q3 FY24 as compared to 21% recorded in the same period last fiscal.

Grasim Industries said that its viscose staple fibre (VSF) sales volumes grew by 34% YoY to reach 205 KT. The viscose business reported revenue of Rs 3,715 crore and EBITDA of Rs 402 crore for Q3 FY24, up 17% and 535% YoY respectively. EBITDA margins improved on the back of higher sales volume and a reduction in input prices. However, the viscose filament yarn (VFY) business margins declined due to lower sales volume and realisations on account of increasing imports from China.

The companys revenue from the chemicals business was at Rs 1,996 crore, down 23% YoY, impacted by sharp decline in caustic realisations. EBITDA stood at Rs 264, down 46% YoY, on the back of improved performance of chlorine derivatives business.

Caustic soda sales volume increased 5% YoY to 299KT in Q3 FY24. ECU for the quarter stood at Rs 31,383 per MT, down 33% YoY. Speciality chemicals (epoxy polymers and curing agents) business margins were impacted by volumes recorded growth of 5% YoY.

International caustic soda spot prices (CFR SEA) improved to $444/ton in Q3 FY24 ($417/ton in Q2FY24). Prices improved to $488/ton in October 23 but the quarter exit prices were at $423/ton.

Textiles business has reported revenue of Rs 575 crore (up 1% YoY) and EBITDA of Rs 52 crore (up 8% YoY), led by higher realisations in linen business followed by sharp rise in flax prices and volume growth.

In paints business, Grasim stated that the trial run for Birla Opuss three plants has started. The sub-brand names have been finalised, and the development work for design, package artwork, and consumer communication has been completed. The painting service, branded as PaintCraft, has completed more than 150 sites by Dec23. Supply chain, logistics and distribution network has been set-up to support the launch in current quarter.

The capex for the quarter stood at Rs 1,425 crore, of which Rs 1,088 crore was for the Paints Business. The company successfully doubled speciality chemicals (epoxy polymers and curing agents) capacity to 246 KTPA in Dec23.

Grasim Industries, a flagship company of the Aditya Birla Group, is a leading diversified player with leadership presence across many sectors. It is a leading global producer of viscose staple fibre and viscose filament yarn, the largest chlor-alkali, advanced material, linen yarn and fabrics producer in India. The company recently has entered paints business and setting up six plants across pan India locations.

The scrip jumped 4.34% to currently trade at Rs 2,147.95 on the BSE.

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