McLeod Russel Sept qtr net up 6% to Rs 131 cr despite dip in revenues

Revenues from operations at Rs 425.06 crore were lower by 13.93% from the same period last year

The country’s largest bulk tea producer, McLeod Russel India, posted a net profit of Rs 130.76 crore in the September quarter, up 6.6 per cent from the year-ago period, even as revenues were lower. The net profit in the year-ago period stood at Rs 122.62 crore.

Revenues from operations at Rs 425.06 crore were lower by 13.93 per cent from the same period last year. Sources in the company indicated that the results reflected its focus on upgrading quality and slightly higher orthodox tea production which was in demand this year. Volumes were lower because of a reduction in bought leaf, they said.

In its disclosures, the company mentioned that the debt resolution process in terms of circular dated June 7, 2019 by the Reserve Bank of India was currently under evaluation by the lenders. The rating in respect to the draft resolution plan prepared by SBI Capital Markets had been received from two rating agencies. However, the company mentioned that considering the restriction imposed on one of the rating agency by Sebi, lenders appointed another agency for further evaluation.

The resolution plan, it is understood, entails additional fund infusion by the promoters and or sale of assets. “Given that the business and the sector are going strong, we can also bring in a financial investor,” sources said.