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Q2FY16 EBITDA at Grasim's VSF division soars 40%
Nov '15
EBITDA of the viscose staple fibre (VSF) division soared 40 per cent year over year at Grasim Industries Ltd in the second fiscal quarter ended September 30, 2015.

A Grasim press release informed that EBITDA at its VSF division surged 40 per cent from the second quarter in fiscal 2015 to Rs 211 crore with volume expansion and the decline in pulp and other input costs.

VSF revenue in the second quarter of fiscal 2016 drove up 13 per cent from a fiscal ago quarter driven by higher sales volume at 114K MT and additional volumes from its Vilayat plant.

“During the quarter, the Vilayat plant reached 100 per cent capacity utilisation and though realisation was maintained on a year on year basis, it was higher by 3 per cent sequentially,” Grasim added.

For the reporting quarter, overall Grasim consolidated revenue grew 6 per cent at Rs 8,393 crore and EBITDA by 16 per cent at Rs 1,485 crore, both rising over the prior fiscal's second quarter.

Consolidated profit after tax surged 17 per cent from Rs 416 crore in the second quarter of earlier fiscal to Rs 489 crore in the quarter under review.

In the Chemical business, revenue was up 26 per cent with a volume growth of 20 per cent in caustic soda and 68 per cent in epoxy.

EBITDA was higher by 17 per cent at Rs.93 crore with the ramping up of production, while ECU realisation remained stable in line with international markets.

“The merger scheme of Aditya Birla Chemicals India Limited (ABCIL) with the company has been approved by Competition Commission of India and the High Court of Madhya Pradesh,” it informed.

According to Grasim, prices in the VSF business are likely to be influenced by the developments in the industry such as the resumption of operations at some of the shut capacities in China and prices of competing fibres.

The Company said it will continue to focus on expanding its domestic market through product development activities, working closely with brands, designers and retailers.

“A better customer connect, through brand Liva is leading to growth in demand for VSF based products in the textile value chain,” Grasim stated.

In the Chemical business, the scale of operations will rise significantly post the merger of ABCIL with the company.

The Aditya Birla Group Company further added that it enjoys a leadership position in all its businesses like cement, VSF and chemical and continues to strengthen the same.

“The company is well poised to reap the benefits of the investments made in the capacity expansions and acquisitions with the ramping up of utilisation and the expected upturn in the business cycle,” it observed. (AR)

Fibre2Fashion News Desk – India

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