Grasim Industries posted stellar second-quarter results with a nearly tripled net profit, supported by a hefty dividend from UltraTech Cement, strong revenue growth in its cellulosic fibre and chemical divisions, and rapid expansion of its new paint business, Birla Opus.

Grasim Industries posted stellar second-quarter results with a nearly tripled net profit, supported by a hefty dividend from UltraTech Cement, strong revenue growth in its cellulosic fibre and chemical divisions, and rapid expansion of its new paint business, Birla Opus.

Grasim Industries posted stellar second-quarter results with a nearly tripled net profit, supported by a hefty dividend from UltraTech Cement, strong revenue growth in its cellulosic fibre and chemical divisions, and rapid expansion of its new paint business, Birla Opus.

Aditya Birla’s flagship company Grasim Industries reported strong earnings for the second quarter, boosted by a dividend from its subsidiary, UltraTech.

The company’s standalone net profit nearly tripled to ₹2,306 crore, from ₹805 crore a year earlier. Standalone revenue rose roughly 32 per cent, heavily supported by Grasim’s Birla Cellulose revenue.  The cellulosic fibre segment generated ₹5,344 crore, out of the total ₹12,747 crore, as prices continue to rise.

The chemical segment also observed substantial revenue growth, with a 15 per cent year-on-year growth rate. The segment was aided by strong demand across chlorine derivatives. Despite softness in caustic soda prices, a depreciating rupee and lower import dependence helped retain the domestic prices.

Speciality chemicals profits dropped as elevated input prices and softer demand weighed on the profitability.

While Grasim’s newer Birla Opus continues to operate at a loss, the paint business’s revenue rose 35 per cent year-on-year. It has captured roughly 7 per cent market share as it attempts to break the long-standing duopoly led by Asian Paints and Berger Paints.  Opus is targeted to achieve profitability this financial year. However, heavy upfront investments and dealer margins pose a challenge.

Though the company reported a one-time loss of ₹825 crore after temporarily shutting down operations at a pulp mill in Canada, the company received dividend income worth ₹3,968 crore from UltraTech Cement, which increased its operating profit by 158 per cent year-on-year to ₹4,615 crore.

The company said the mill, which was run as a joint venture, had to suspend operations because of broader macroeconomic factors.

Grasim Industries stock has gained 6.09 per cent year to date.