Telecom buoys Birla Nuvo profit

CORPORATE SCORECARD

Aditya Birla Nuvo, a diversified Aditya Birla Group company, has recorded a 50 per cent increase in net profit at Rs 99.8 crore for the quarter ended June 30 compared with Rs 66.7 crore in the corresponding previous quarter. Net sales grew to Rs 2,320.8 crore during the period from Rs 1,305.7 crore, up 78 per cent.

Attributing the growth to robust telecom business, the company said it was optimistic about meeting the challenges of strategic growth initiatives and stretching out in the short time. Earnings per share (EPS) for the quarter was Rs 10.7 compared with Rs 7.5 last year.

Telecom business of the Birla company, Idea Cellular, pumped in Rs 308.5 crore as net profit compared with Rs 89 crore in the previous corresponding quarter. It added 2.12 million subscribers during the quarter, taking its subscriber base to 16.13 million and capturing 15.4 per cent of operations in its 11 service areas.

The company's revenue from branded garments business grew by 14 per cent to Rs 161.2 crore from Rs 141 crore. Product mixes improved the realisation in the company's insulators business, which grew by 57.6 per cent to Rs 84 crore from Rs 53.4 crore. Effective April 1, 2007, Aditya Birla Insulators (ABIL), a wholly owned subsidiary of Aditya Birla Nuvo, was merged with the company.

In its life insurance business, total income rose by 205 per cent to Rs 625.4 crore from Rs 205 crore last year.

However, the Birla company could not do well in its rayon, textiles and fertilisers businesses. Lower sales during the quarter brought revenues of the diversified company down to Rs 104 crore from Rs 112 crore. Revenues from textiles dropped by 4 per cent to Rs 148.8 crore from Rs 154.8 crore. Recently, the company divested its synthetic textile plant, Rajashree Syntex, in Midnapur.

Net turnover from the fertiliser division fell to Rs 116.3 crore due to shutdown of units and and de-bottlenecking. The BPO business of the company also took a hit on the back of a weaker US dollar and higher interest cost on borrowings for the acquisition of Minacs. The company has rebranded Transworks-Minacs as Aditya Birla Minacs. The revenue from this business slipped to Rs 42.2 crore during the quarter as against Rs 48.1 crore in the corresponding previous quarter.

In a flat stock market, the company's stock closed at Rs 1,374.6, down 0.81 per cent.