Grasim Industries, the flagship company of the Aditya Birla Group, registered a 94.6 percent year-on-year growth in standalone profit for the quarter ended December 2020, driven by strong operating performance.
Profit increased to Rs 359.4 crore in Q3FY21, from Rs 184.7 crore in the corresponding period despite a significant jump in tax cost to Rs 126.2 crore against Rs 22.2 crore in the same period. A CNBC-TV18 poll has estimated profit at Rs 250 crore
But standalone revenue from operations fell 4.8 percent year-on-year to Rs 3,671.8 crore in Q3FY21 due to viscose and chemicals businesses, missing estimates. The CNBC-TV18 poll estimate stood at Rs 4,060 crore.
Viscose (pulp, viscose staple fibre and filament yarn) business reported a 2.2 percent year-on-year decline in revenue at Rs 2,145.14 crore and chemicals (caustic soda and allied chemicals) segment registered a 6 percent YoY fall in revenue at Rs 1,280.96 crore, but sequentially both businesses grew by 27.8 percent and 13.8 percent respectively.
"The VSF demand In India recovered to pre-COVID-19 levels leading to 28 percent revenue growth sequentially. Consequently, the share of domestic sales in the sales mix grew from 82 percent in Q2FY21 to 91 percent in Q3FY21 and the share of value-added product in the overall sales mix improved to 22 percent in Q3FY21 from 15 percent in Q2FY21," said Grasim in its BSE filing.
The viscose business performance has steadily improved since Q1FY21 on the back of robust demand growth led by consumer spending picking up with the onset of festive & wedding season, the company added.
Grasim said the domestic caustic-soda business witnessed an upsurge in demand during the quarter, driven by higher usage from textile, alumina and paper industries, recording capacity utilisation levels of 89 percent in Q3FY21, an improvement of 9 percent on a sequential basis.
Its standalone earnings before interest, tax, depreciation and amortisation (EBITDA) surged 68.2 percent year-on-year to Rs 645.6 crore and margin spiked 770 bps YoY to 17.6 percent in the quarter ended December 2020.
The operating numbers were above analysts' expectations. EBITDA was estimated at Rs 570 crore and margin at 14 percent by the CNBC-TV18 poll.
Recently, the board of directors approved a foray into the paints business with an initial capital expenditure of Rs 5,000 crore over the next three years.
Grasim shares closed at Rs 1,242.35 on the BSE, up 0.59 percent with 1.81 lakh shares.
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