Grasim Industries rose 0.84% to Rs 2823.60 at 13:57 IST on BSE after consolidated net profit fell 27.42% to Rs 450 crore on 3.54% increase in revenue to Rs 6849 crore in Q2 September 2013 over Q2 September 2012.
The result was announced during trading hours today, 30 October 2013.
Meanwhile, the BSE Sensex was up 119.43 points, or 0.57%, to 21,048.44.
On BSE, 9028 lakh shares were traded in the counter compared with average volume of 7,525 shares in the past one quarter.
The stock rose 1.40% at the day's high of Rs 2,839.05 so far during the day. It fell 1.25% at the day's low of Rs 2,765 so far during the day. The stock hit a 52-week high of Rs 3,445 on 29 October 2012. The stock hit a 52-week low of Rs 2,121 on 4 September 2013.
The stock had underperformed the market over the past one month till 29 October 2013, rising 4.56% compared with the Sensex's 6.09% rise. The scrip had also underperformed the market in past one quarter, rising 2.92% as against Sensex's 6.82% rise.
More From This Section
The large-cap company has an equity capital of Rs 91.81 crore. Face value per share is Rs 10.
Grasim said that its Viscose Staple Fibre (VSF) business recorded a satisfactory performance, given the challenging market conditions. Supported by capacity expansion at Harihar, production increased by 15% over last year. Sales volume at 93,025 MT was up by 9% led by higher exports. Though VSF demand is growing globally, the overcapacity in China created at the time of VSF boom has created pressure on realizations in global markets. The rupee depreciation led increase in pulp cost was offset by decline in caustic and sulphur prices. However, lower realisation resulted in marginal decline in operating profit in standalone business. Sequentially, operating profit rose by 29% with higher volumes as well as better realisation. Consolidated profit before interest, depreciation & taxes (PBIDT) of the business has also improved sequentially by 68% from Rs 161 crore to Rs 269 crore, supported by better performance from pulp units, the company said in a statement.
Grasim said its cement subsidiary, UltraTech Cement's performance was been impacted mainly on account of lower selling prices as well as subdued demand owing to monsoon impact and low offtake from the infrastructure and housing sectors. The benefit of softening in prices of imported coal was largely negated by the devaluation of the rupee. Optimization of the fuel mix helped in power and fuel cost reduction.
With the commissioning of the grinding unit (1.6 million tonnes per annum) at Jharsuguda, Odisha in October 2013, Cement capacity stands augmented to 55.5 million tonnes per annum. On commissioning of all the projects currently under implementation and the acquisition of Gujarat cement unit of Jaypee Cement Corp., UltraTech's cement capacity will increase to 70 million tonnes per annum, Grasim said.
The company said its 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 Q1. Volumes will improve with the gradual ramp up of capacity. ECU realisations saw a correction from the peak level witnessed during fiscal year ended March 2013, even as it rose by 4% quarter-on-quarter (QoQ).
In its outlook, Grasim said that the VSF industry continues to face pricing pressure in the immediate term, given the surplus capacity in China. Capacity addition in China is expected to slowdown because of subnormal returns in industry currently. In Cement, the demand is expected to grow by 5% in the fiscal year ending March 2014 due to the slowdown in the GDP growth rate. It however should recover to over 8% with the improvement in the economic environment.
Capacity expansions in VSF and cement will provide additional volumes, driving growth and further consolidate the Company's leadership. This will enable the company to move forward rapidly, with the recovery in the market, the company said.
Grasim Industries is a flagship company of Aditya Birla Group. Grasim's businesses comprise VSF, cement, chemicals and textiles. Its core businesses are VSF and cement.
Powered by Capital Market - Live News