Grasim Industries' profit falls 35 pc to Rs 1 029.4 cr in Q2 revenue grows 26 pc

     New Delhi, Nov 13 (PTI) Aditya Birla Group's flagship firm Grasim Industries Ltd on Friday reported a 34.7 per cent year-on-year decline in its consolidated net profit at Rs 1,029.42 crore for the September quarter of FY27, citing an exceptional loss due to impairment of its Canada-based Pulp JV AV Group NB Inc.

     The company had posted a net profit of Rs 1,576.32 crore during the July-September quarter a year ago, according to a regulatory filing by Grasim Industries, a holding firm for group companies such as UltraTech, Aditya Birla Capital and Aditya Birla Renewables.

     Revenue from operations grew 25.86 per cent to Rs 50,105.18 crore in the reporting quarter, which, according to Grasim's earnings statement, is the "highest-ever" in the company's history.

     It was Rs 39,809.58 crore in the corresponding period of the previous fiscal.

     During the quarter, Grasim accounted for an "exceptional charge of Rs 767 crore towards impairment" of the pulp JV, AV Group NB Inc., Canada. Grasim's profit before exceptional items and tax was at Rs 3,468.94 crore, up 34 per cent, from Rs 2,588.34 crore recorded in the corresponding period a year ago.

     Total expenses of Grasim Industries were 24.45 per cent higher at Rs 47,037.72 crore.

     Its total income, which includes revenue from other sources, was at Rs 50,438.79 crore, up 25.32 per cent.

     In the first half (H1) of FY27, Grasim Industries' revenue almost reached the Rs 1 lakh crore mark. Its consolidated revenue from operations was at Rs 99,460.14 crore, up 23.23 per cent, during the period.

     Grasim's revenue from its cellulosic fibre business was up 28.77 per cent to Rs 5,343.50 crore.

     The revenue growth was "supported by volume growth, favourable product mix and stable domestic realisation, despite geo-political issues and higher input and logistics costs," it said.

     Revenue from the chemicals business was up 15 per cent to Rs 2,758.95 crore in the September quarter.

     The growth was led by "volume growth and robust performance in chlorine derivatives business. Speciality chemicals revenue share, in the overall chemicals segment, stood at 28 per cent. EBITDA stood at Rs 326 crore, down by 11 per cent YoY, due to higher power costs in caustic and lower profitability in speciality chemicals business", it said.

     Speciality chemicals profitability was impacted due to elevated input prices and softer demand across end-user industries, it said.

     Revenue from its building material business grew 23 per cent to Rs 27,377.81 crore. It was Rs 22,253.32 crore in the July-September quarter a year ago. This was led by "all-round performance across cement, paints and B2B e-commerce", it said.

     UltraTech, the country's leading cement maker, saw its consolidated sales volume at 38.2 MT (million tonnes), up by 12.9 per cent, while the ready-mix concrete sales volume grew by 23 per cent YoY. UltraTech revenue growth "was mainly led by volume growth", it said, adding that during the quarter, UltraTech added 4.6 MTPA of 3 grey cement capacity, taking total capacity (India + overseas) to 210.1 MTPA.

     Its paints business, Birla Opus, revenue for Q2FY27 stood at Rs 1,337 crore, up 35 per cent YoY. It stood at Rs 2,999 crore for H1FY27, up 50 per cent YoY, outpacing organised decorative paints industry growth.

     "The Q2 volume grew by 20 per cent YoY & H1FY27 volume grew by 33 per cent YoY. The focus extends beyond quarterly seasonality towards building a business capable of converting market acceleration into enduring growth," it said. 'Birla Opus aims to cross double-digit revenue market share of the Indian Organised Decorative Paints market in H2FY27.

     "The portfolio reached 239 products, while aided brand awareness scores reached enviable 92 per cent; giving confidence to deliver guided revenue of Rs 10,000 crore by exit of FY28," it said.

     Its B2B e-commerce platform, Birla Pivot, which offers construction material online, "revenue stood at Rs 2,785 crore, up 66 per cent YoY with annualised revenue run-rate (ARR) now above Rs 11,000 crore; one of the fastest growing companies in India's B2B e-commerce landscape." Project and retail business accounted for 90 per cent and 10 per cent of revenue, respectively.

     "The business aims to cross Rs 12,000 crore in revenue for FY27 and remains on track to EBITDA profitability in H2FY27, focusing on category economics & cost control," it said. Revenue from the financial services segment -- Aditya Birla Capital Ltd (ABCL) -- was up 32.36 per cent to Rs 13,990.35 crore.

     "The total lending portfolio (NBFC + HFC) stood at Rs 2,33,930 crore, up 32 per cent YoY, while customer assets across its asset management and insurance businesses stood at Rs 12,33,906 crore, reflecting the strength of its integrated financial services franchise,” it said.

     Revenue from other business, which includes textiles, renewables and insulators, was up 16.19 per cent to Rs 1,157.83 crore in the September quarter.

     About capex, Grasim said the FY27 budget is Rs 3,157 crore across its standalone businesses, with nearly 45 per cent allocated to growth projects.

     The total capex spent for H1FY27 stood at Rs 1,022 crore. About the outlook, Grasim said that as India advances, sustained investments in infrastructure, manufacturing, housing and the energy transition are expected to create significant growth opportunities across Grasim's businesses.

     Stock of Grasim Ltd on Friday settled at Rs 3,020 apiece on the BSE, down 3.21 per cent from the previous close.

(This story has not been edited by THE WEEK and is auto-generated from PTI)