Grasim Inds Q1 PAT drops 23% YoY to Rs 1,208 cr

Revenue from operations increased 9% YoY to Rs 33,860.75 crore in Q1 FY25, driven by strong performance from its diversified businesses portfolio. Cellulosic Staple Fibre, Building Materials and Financial Services businesses delivered superior performance.

Profit before exceptional items and tax declined 14.37% to Rs 2,943.67 crore in Q1 FY25 as compared with Rs 3,437.60 crore posted in same quarter last year. Exceptional items stood at Rs 32.50 crore.

Consolidated EBITDA was lower by 4% at Rs 4,760 crore in Q1 FY25. This was driven by investments in the Paints business.

Revenue from Cellulosic Staple Fibre (CSF) business for the quarter was at Rs 3,787 crore. up 6% YoY. sales volume stood at 212 KT, up 14% YoY. Cellulosic Fashion Yarn (CFY) business recorded marginal volume growth of 2% YoY, due to subdued demand conditions in the downstream value chain and lower priced export into India by from Chinese producers.

Revenue from Chemicals business declined 4% YoY to Rs 2,066 crore in Q1 FY25. Speciality Chemicals (epoxy polymers and curing agents) revenue mix improved to 30% for the quarter from 25% in Q1FY24.

The building materials business reported revenue of Rs 18,701 crore, up 11% YoY, led by the growth in Cement and ramp-up in revenues from new growth businesses - Paints and B2B E-Commerce. EBITDA stood at Rs 2,909 crore, down 7% YoY mainly due to initial funding of new growth businesses.

Consolidated sales volumes of cement business (UltraTech) grew by 7% YoY to 31.95 MT and ready-mix concrete sales volumes grew by 22% YoY to 3.25 Mn. During the quarter, grey cement capacity expanded by 8.7 Mn TPA, taking the total grey cement capacity to 154.9 Mn TPA.

The board of directors of UltraTech approved the purchase of 32.72% equity stake of the promoters & their associates in India Cements Limited (ICL). UltraTech will pay Rs 3,954 crore at Rs 390 per share. This has triggered a mandatory open offer, at Rs 390/share.

The company said that the paints business under the brand name ‘Birla Opus’ is ramping up production across product categories at already commissioned three plants. Trial production has also commenced at the Chamarajanagar plant. The first flagship experience store is operational in Mumbai. Media campaign under ‘Make life Beautiful’ was launched with a focus on rapid brand building across all marketing channels. Outreach to influencers (contractors and painters) remains on track. The total Capex for the business is Rs 7,795 crore till June 2024, approximately 77% of the planned capex outlay.

The financial services business (Aditya Birla Capital), revenue and EBITDA, as consolidated in accordance with Ind AS, stood at Rs 8,807 crore and Rs 1,058 crore, registering growth of 25% and 17%, respectively. The overall lending portfolio (NBFC and HFC) increased by 27% YoY and 3% QoQ to Rs 1,27,705 crore.

The consolidated capex for Q1 FY25 stood at Rs 983 crore. The budgeted standalone capex for FY25 is Rs 4,553 crore of which around Rs 3,000 crore, is towards new growth businesses.

Grasim Industries, a flagship company of the Aditya Birla Group, is a leading diversified player with leadership presence across many sectors. It is a leading global producer of viscose staple fibre and viscose filament yarn, the largest chlor-alkali, advanced material, linen yarn and fabrics producer in India. The company recently has entered paints business and setting up six plants across pan India locations.

The counter rose 1.21% to Rs 2,574.80 on the BSE.