Grasim Industries is likely to witness a 22 percent year-on-year (YoY) jump in profit after tax (PAT), while sequentially the PAT is expected to rise 43 percent. Grasim is scheduled to declare its results for the quarter ended September 2022 on Monday, November 14.
Experts expect the standalone revenues of the viscose fibre and chemicals major to grow 43 percent on year, but revenues are likely to remain flat-ish compared to the previous quarter.
According to a poll of brokerages conducted by Moneycontrol, the flagship company of the Aditya Birla group is expected to report a PAT of Rs 1,158 crore for the quarter, and revenues of Rs 7,030 crore.
The company had recorded revenues of Rs 4,933 crore during the corresponding period last year, and PAT of Rs 947 crore.
During April-June of this year, the standalone PAT for the quarter stood at Rs 809 crore on revenues of Rs 7,253 crore.
The positive performance during this quarter is likely due to an on-year growth in volumes and realisations in both its viscose and chemicals businesses.
In its report, brokerage firm Motilal Oswal said, “We expect revenues for the VSF business to grow 50 percent on-year, with an 18 percent YoY growth in realisation. Revenues of the chemicals segment are likely to witness 66 percent YoY growth, with a 49 percent increase in realisation.”
Analysts at Kotak Institutional Equities anticipate a 21 percent YoY increase in VSF revenues, and a 9 percent YoY growth in its chemical business, led by the addition of new capacity.
In the VSF segment, experts anticipate an EBITDA / Kg of Rs 19 against Rs 33 / Kg during the same period last year.
They expect the VSF EBITDA to decline between 20–40 percent YoY to ~Rs 400 crore due to cost pressures, while the EBITDA for the chemical segment is likely to grow 2X YoY to Rs 520 crore, supported by better realisation.
The operating margin for the chemical segment should improve 10.7 percent YoY, but decline 4.5 percent quarter-on-quarter (QoQ).
Grasim closed Rs 3.9 higher at Rs 1,708.45 on November 11 at The National Stock Exchange (NSE). The stock is down 7.4 percent over the past year and has gained 3.9 percent over the past one month.
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