Grasim's (Standalone) numbers for Q4FY19 missed estimates on EBITDA and PAT fronts. Revenue for the quarter was up 16.1% yoy to Rs5,352cr, against consensus estimates of Rs5,071cr. EBITDA grew by 5.6% yoy to Rs899cr, against consensus estimates of Rs993cr. EBITDA margin contracted by 166bps yoy to 16.8%. PAT grew by 20.9% yoy to Rs451cr against consensus estimates of Rs655cr.
Standalone PAT before exceptional item came in at Rs506cr, down 3.8% yoy.
Consolidated revenue (Rs20,965cr) and EBITDA (Rs3,786cr) were up 21% yoy and 27% on yoy basis respectively.
The Viscose Business reported net revenue of Rs2,625cr, up 18% yoy with EBITDA at Rs413cr, up 3% yoy. The share of the domestic sales in the overall sales rose to 86% in Q4FY19 from 83% in Q4FY18.
The VSF business reported production and sales volume of 130KT and 139KT respectively recording an increase of 15% yoy and 13% yoy respectively.
Value added Speciality Fibre line of 16 KTPA capacity based on in-house technology has been commissioned at Kharach in May 2019.
The Brownfield capacity expansion plan of 219 KTPA at Vilayat is progressing well with construction work in full swing, scheduled to be commissioned in FY21.
The company’s popular VSF brand ‘Liva’ for the VSF business has been extended, to home textile category with launch of “LIVA HOME”.
Chemical segment’s net revenue for the quarter grew 17% yoy to Rs1,688cr with a 5% yoy increase in EBITDA to Rs434cr.
For Q4FY19, the production and sales volume of 254KT and 261KT respectively recorded an increase of 16% yoy and 21% yoy respectively.
The acquisition of under construction Chlor-Alkali plant in Andhra Pradesh (with a potential capacity of 365 KTPA) for Rs253cr. during the Q4FY19 is aimed at strengthening the operations on the east coast of India, a major Caustic Soda consumption hub.
The company is in the process of implementing approved capacity expansion plan from 1,147 KTPA to 1,457 KTPA at multiple locations and the same are in different stages of execution.
The total capex plan of Rs6,454cr. (at standalone level) is under execution for raising capacities in both the VSF and Chemical businesses, apart from ongoing modernisation capex at various plants.
This capital expenditure will be incurred over FY20-22 and will be majorly funded from internal accruals. The cash profit generated in FY19 is over Rs3,400cr. at standalone level.
Grasim Industries Ltd ended at Rs. 908.30, up by 21.85 points or 2.46% from its previous closing of Rs. 886.45 on the BSE.
The scrip opened at Rs. 890 and touched a high and low of Rs. 914 and Rs. 879.10 respectively. A total of 22,93,968 (NSE+BSE) shares were traded on the counter. The stock traded below its 200 DMA.
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