Grasim Industries fell 1.43% to Rs 2,537 at 9:37 IST on BSE after consolidated net profit fell 39.55% to Rs 331.93 crore on 3.86% rise in total income to Rs 7226.18 crore in Q3 December 2013 over Q3 December 2012.
The result was announced on Saturday, 1 February 2014.
Meanwhile, the BSE Sensex was down 71.09 points, or 0.35%, to 20,442.76.
On BSE, so far 3,832 shares were traded in the counter, compared with an average volume of 8,817 shares in the past one quarter.
The stock hit a high of Rs 2,594.90 and a low of Rs 2,512.05 so far during the day. The stock hit a 52-week high of Rs 3,159 on 20 May 2013. 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 31 January 2014, falling 5.18% compared with the Sensex's 3.10% fall. The scrip had underperformed the market in past one quarter, sliding 8.65% as against Sensex's 3.07% fall.
The large-cap company has an equity capital of Rs 91.82 crore. Face value per share is Rs 10.
Grasim Industries said its performance was constrained due to subdued economic condition.
The company said that Viscose Staple Fibre (VSF) business has recorded volume growth, supported by increased capacity at Harihar. Production increased by 4% over the last year. Sales volume at 97,049 MT was up by 24%, led by better performance in both domestic and exports markets. The company was able to maintain the realizations, despite the sharp fall in the international prices, supported by the rupee depreciation. The input costs have gone up due to the increase in pulp prices coupled with rupee depreciation. The performance of the Pulp JVs was affected on account of planned maintenance shutdowns. The anti-dumping duty levied in China impacted realizations and the volumes of pulp sold in China, Grasim Industries said in a statement.
The firms said that the Epoxy project (51,500 tonnes per annum) at Vilayat was commissioned in December 2013. The VSF project (120,000 tonnes per annum) at Vilayat is expected to go on stream in a phased manner from quarter 4.
For its cement subsidiary, UltraTech Cement, the company said that the combined cement and clinker sales volume increased marginally at 10.76 million tons. The cement industry volumes remained flat due to the continued slow down in the Indian economy. Based on continuous cost optimization measures, the business has been able to contain the cost, the company said.
With the commissioning of the grinding unit (1.6 million tonnes per annum) at Jharsuguda, Odisha in October 2013, UltraTech's 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., total cement capacity will increase to 70 million tonnes per annum.
The chemical business reported a growth of 14% in sales volumes. ECU realizations improved over quarter 2 but were flat on a year on year (YoY) basis. The operations at Vilayat (Gujarat), which were impacted by the floods, have resumed in December, 2013 and are being ramped up in a phased manner, the company added.
Grasim Industries in its outlook said that the current difficult market conditions have affected the performance of both the businesses. The performance of cement business should improve with the expected recovery post general elections in India and of VSF business based on global rebalancing of excess capacity. The commissioning of major projects by the company will help improve volume and profitability.
Grasim Industries, a flagship company of the Aditya Birla Group, started as a textile manufacturer in 1948. Today, its core businesses are VSF and cement, contributing over 90% of its revenues and operating profits. It is also present in chemicals which is essentially a backward integration of VSF.
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