Q2 Results: Grasim Industries Faces Net Loss After Vodafone-Idea Merger

Grasim Industries Ltd. incurred a surprise loss in the second quarter after paying a one-time non-cash exceptional item worth Rs 2,003 crore.

Net loss stood at Rs 1,446 crore in the July-September period versus the company’s Rs 525 crore profit in the year-ago period, the Aditya Birla-group said in an exchange filing. The exceptional loss is linked to the Vodafone-Idea merger, creating India’s largest telecommunications company. Vodafone Idea Ltd. ceased to be an associate of the company from Aug. 31, which led to Grasim excluding it as a part of its profit after tax.

The cements-to-textiles conglomerate’s revenue rose 23.8 percent to Rs 16,795 crore in the July-September quarter compared with last year.

Operating profit or earnings before income, tax, depreciation and amortisation rose marginally to Rs 2,553 crore while operating margin contracted 340 basis points to 15.2 percent.

Segmental Breakup (Year-on-Year)

• Chemical business revenue rose 38 percent to Rs 1,612 crore.
• Better realisation, higher sales volume led to 60 percent growth in Ebitda of the chemical business to Rs 456 crore.
• UltraTech Cement registered revenue of Rs 8,151 crore, a 20 percent rise.
• Cement sales volume grew 18 percent to 16.6 million tonnes per annum.

Shares of Grasim Industries closed flat at Rs 876.35 apiece ahead of the earnings announcement. The stock has declined nearly 27.3 percent this year compared with 3.8 percent advance in the Nifty 50.