The cement business dragged Aditya Birla Group company Grasim Industriesí net profit, which fell by a sharp 27% to Rs 450 crore in the quarter ended September against Rs 620 crore in the same period last year. Revenues for the second quarter increased by a mere 3.5% to R6,849 crore against Rs 6,615 crore in the same period last year, aided by viscose staple fibre (VSF) and chemical businesses.
Grasim Industries Ltd's Ebitda for the September 2013 quarter fell 27% to Rs 986 crore while the operating margin was lower by 610 basis points at 14.5%.
The VSF business saw a 9% increase in sales volume to 93,025 mt, led by higher exports. supported by capacity expansion at Harihar, production increased by 15% over last year. The rupeeís depreciation led to an increase in pulp cost, which was offset by a decline in caustic and sulphur prices. Sequentially, operating profit rose 29%, with higher volumes as well as better realisation.
Combined cement and clinker sales volumes stood at 10.03 mt; however, PAT halved to Rs 280 crore from last year, and net revenue declined 2% to Rs 4,870 crore. It was impacted mainly on account of lower selling prices, subdued demand and low offtake from the infrastructure and housing sectors.
The chemical business reported a 26% rise in production and 20% growth in sales volumes, with uninterrupted operations at Nagda and the commissioning of the caustic soda plant at Vilayat (Gujarat) in the first quarter.
Grasim expects to commission the 1,20,000-tonne- per-annum VSF project at Vilayat in Gujarat in a phased manner in the fourth quarter and its Epoxy project of 51,000-tonne-per-annum in the third quarter.