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    540691   INE674K01013

ADITYA BIRLA CAPITAL LIMITED

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Aditya Birla Capital : Management Corporation Pvt. Ltd. - Grasim's Q4FY21 EBITDA jumps 2X Y-o-Y

05/25/2021 | 05:37am EDT

Consolidated PAT (After Exceptional item) for Q4FY21 stood at Rs.1,715 Cr. up 14 per cent from Q4FY20.

Standalone PAT for Q4FY21 stood at Rs.480 Cr. up 36per cent from Q4FY20.

Last year, the PAT (after extraordinary items) included reversal of deferred tax liability.

Consolidated revenue for the fourth quarter was up 26 per cent YoY at Rs.24,399 Cr. EBITDA for Q4FY21 surged 62 per cent YoY to Rs.5,142 Cr. PBT at Rs.3726 Cr was up 133 per cent from the corresponding quarter last year.

Consolidated Revenue, EBITDA and PBT for FY21 stood at Rs.76,398 Cr, Rs.15,766 Cr. and Rs.10,113 Cr. respectively and standalone Revenue, EBITDA and PBT for FY21 stood at Rs. 12,386 Cr, Rs.2,078 Cr. and Rs.1,014 Cr. respectively.

Revenue and EBITDA from the discontinued operations (Fertiliser Business) for Q4FY21 stood at Rs.560.96 Cr. and Rs.33.16 Cr. (Q4 FY 20: Rs.622.73 Cr. and Rs.68.11 Cr.) respectively which is not included in the financials above. The Fertiliser Business divestment process is expected to be completed by Q2FY22 after receipt of NCLT approvals for the Scheme of Arrangement amongst other pending approvals.

While the signs of economic recovery picking up momentum was visible during the Q4FY21, the impact of the second wave of COVID-19 on the economic activity needs to be assessed.

Viscose Business

The Global textile fibre demand witnessed a sharp recovery in H2FY21 led by a spurt in the consumer demand and restocking of the pipeline. The growing consumer preference for comfortable, casual & value for money clothing has spurred demand for cellulosic fibre and VSF has been a key beneficiary of this shift.

The buoyancy in the domestic demand was reflected in 9 per cent YoY growth in the domestic sales. VAP portfolio reported 17 per cent YoY growth during Q4FY21. The share of value-added products in the overall sales mix as a result improved to 26 per cent in Q4FY21 from 22 per cent in Q3FY21.

The VSF prices in China surged steeply in Q4FY21 to attain a multiyear high. China VSF prices rose from 12,800 RMB in Jan-21 to 15,800 RMB in Mar-21 driven by strong consumer demand, restocking, and rise in cotton prices during the last 12 months. China's VSF inventory at plants declined significantly from 45 days (Apr-20) to 13 days (Mar-21).

The Net Revenue for the Viscose segment (including VFY) stood at Rs.2,583 Cr. and EBITDA at Rs.625 Cr., driven by higher sales volumes, better product mix, significant cost savings and improved realisation. During the quarter, the pulp prices and input costs have, however, started firming up in line with commodities.

Chemical Business

The domestic Caustic Soda business and Advanced Material business reported a strong operational performance during the quarter. The caustic soda capacity utilisation improved to 94 per cent in Q4FY21 from 89 per cent in Q3FY21. International caustic soda prices improved sequentially led by temporary supply disruptions in the later part of the quarter.

The Advanced Material (Epoxy) Sales Volume growth was driven by demand across segments- especially from the wind and auto segment. The sector witnessed demand outstripping the supply due to raw material constraint, coupled with disruption at certain global manufacturers.

The Net Revenue for Q4FY21 stood at Rs.1,472 Cr. and EBITDA stood at Rs.185 Cr.

Paint Business

The Paint business is making brisk progress in line with the plans. The company is in the process of hiring senior professionals and specialists for the business. It is also actively engaged in shortlisting /acquiring land for plant locations and is progressing with the engineering planning for the project.

Capex Plan

The total capex spend for FY21 stood at Rs.1,508 Cr. The capex plan for FY22 (excluding paints and fertiliser) is Rs.2,604 Cr. which includes the VSF expansion project at Vilayat with Line-1 scheduled to be commissioned in Q2FY22 and Line-2 in Q3FY22. Other capex includes Grasim's plans to invest towards increasing its Advanced Materials (Epoxy) business capacity by 125 KTPA through a brown field expansion at the existing location of Vilayat, Gujarat. This will include standard & specialty epoxy products along with curing agents. Being an industry leader, Grasim will continue to play a proactive role in growing & supporting the demand growth.

In the Chlor-Alkali business, Grasim plans an investment in a 200TPD Caustic brownfield expansion at Vilayat, Gujarat. This would take the total capacity to 1,400 TPD at its Vilayat site and will primarily meet the customer requirements in the country's West Region. The expansion will be commissioned in 24 months post receipt of statutory clearances/approvals.

Sustainability

The VSF business received the prestigious 'Innovative and Sustainable Supply Chain Award' by United Nations Global Compact Network India. The business was given the award for its pioneering innovation relating to recycled and circular fibre made with pre-consumer fabric waste based on inhouse technology (Next Generation fibre) and its unique blockchain-based platform GreenTrack that provides 'end to end' supply chain traceability to textile industry/ brands.

The Pulp & Fibre business released its 2nd Sustainability Report - focused on providing an insight into the integration of sustainability into its business strategy and an update on approach and progress that has been made in all key areas.

The Solar Renewable business commissioned 182 MW of new capacity in FY21 taking the total capacity to 502 MW.

Dividend

The Board of Directors of Grasim has recommended a dividend of ' 5 per equity share and a special dividend of ' 4 per equity share for the year ended 31st March 2021, taking the total dividend to ' 9 per equity share. The total outflow on account of the dividend would be ' 592 Cr. In terms of the provisions of the Finance Act, 2020, dividend shall be taxed in the hands of shareholders at applicable rates of tax and the Company shall withhold tax at source appropriately.

COVID 19

The company continues to give utmost primacy to the safety and well-being of employees and local communities in the wake of the second wave of COVID-19. The company has undertaken a series of steps to provide relief during this unsettling period. These include: setting up COVID treatment centres, earmarking beds for patients in hospitals across the country, and mobilising oxygen cylinders and concentrators across locations. An Oxygen plant has also been set up at Veraval as part of a comprehensive plan.

The company has also tried to accelerate the vaccination drive for employees and workers pan-India, having done over 13,000 vaccinations. In addition, the company has distributed three-layered high-quality masks (50,000 masks) across manufacturing locations.

The company has also taken additional steps like enhanced medical coverage to cover hospitalisation expenses of employees and their families and announced ex-gratia benefits to support families of deceased employees (including contractual). These benefits would cover housing, medical, schooling, and other financial support to the family.

Cement Subsidiary - UltraTech Cement Ltd

UltraTech's Consolidated Revenue was at Rs.44,726 Cr.; EBITDA at Rs.12,302 Cr. and PAT at Rs.5,463 Cr. for FY21. The consolidated sales volume stood at 86.42 MTPA.

For Q4 FY 21, UltraTech reported Consolidated Revenue of Rs.14,406 Cr., EBITDA of Rs.3,751 Cr. and PAT of Rs.1,775 Cr. The consolidated sales volume stood at 27.78 MTPA.

UltraTech successfully raised USD 400 million by way of issuance of unconditional, unsubordinated and unsecured USD denominated notes (in the form of 'Sustainability Linked Bonds'), due 16th February 2031 @ 2.80 per cent per annum.

The net debt of UltraTech stands reduced to Rs.6,717 Cr. (March-21) down Rs.10,264 Cr. since March-20. The Net Debt/LTM EBITDA at consolidated level stood at 0.55x (March-21) significantly down from 1.72x (March-20).

The UltraTech board approved (Dec-20) capacity expansion of 19.5 MTPA through a mix of greenfield and brownfield expansion. Upon completion of both rounds of expansion the capacity will expand to 136.25 MTPA.

Financial Services Subsidiary - Aditya Birla Capital Limited (ABCL)

The Consolidated Revenue of ABCL grew 15 per cent YoY to Rs.19,248 Cr in FY21. ABCL, through its subsidiaries, continues to maintain its track record of consistency in performance through market and macroeconomic cycles, with its diversified business model. The consolidated profit after tax (after minority interest) grew 22 per cent year on year to Rs.1,127 Cr in FY21.

The Consolidated Revenue grew by 16 per cent YoY to Rs.5,587 Cr. and profit after tax (after minority interest) was up 2.6x to Rs.375 Cr. in Q4FY21.

The NBFC and Housing Finance lending book stood at Rs.60,557 Cr. in Q4FY21. The Gross disbursement grew 2x times year on year, to Rs.7,701 Crore in Q4 FY21. The Net Interest Margin (Incl. Fee Income) for the NBFC business is up 98 bps Y-o-Y to 5.98 per cent in Q4FY21.

In Asset Management, the Overall Domestic AAUM increased to Rs.2,59,422 Cr. (Q4FY21) up 28 per cent YoY. The PBT/ AAUM increased from 26bps in FY20 to 28 bps in FY21.

In Life Insurance, Individual First Year Premium (FYP) for FY21 grew by 14 per cent YoY to Rs.1,938 Cr. Renewal premium grew 20 per cent YoY, to Rs.5,212 Crore in FY21, out of which 65 per cent has been collected digitally.

In the Health Insurance business, Gross written premium for FY21 increased to Rs.1,301 Cr., up 49 per cent YoY.

About Grasim Industries Ltd.

Grasim Industries Limited, a flagship company of the Aditya Birla Group, ranks amongst the top publicly listed companies in India. Incorporated in 1947, it started as a textiles manufacturer in India. Today, it has evolved into a leading diversified player with leadership presence across many sectors. It is a leading global producer of Viscose Staple Fibre, the largest Chlor-Alkali, Linen and Insulators player in India. Through its subsidiaries, UltraTech Cement and Aditya Birla Capital, it is also India's largest cement producer and a leading diversified financial services player. At Grasim, there is an endeavour to create sustainable value for 24,000+ employees, 230,000+ shareholders, society and customers. The company reported consolidated net revenue of over Rs.76,398 Cr, and EBITDA of Rs.15,766 Cr. in FY 2021.

Contact:

Tel: (07366) 246760-66

Fax: (07366) 244114

Web: www.grasim.com

Cautionary Statement

Statements in this 'Press Release' describing the Company's objectives, projections, estimates, expectations or predictions may be 'forward looking statements' within the meaning of applicable securities law and regulations. Actual results could differ materially from those express or implied. Important factors that could make a difference to the Company's operations include global and Indian demand supply conditions, finished goods prices, feedstock availability and prices, cyclical demand and pricing in the Company's principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the Company conducts business and other factors such as litigation and labour negotiations. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statement, on the basis of any subsequent development, information or events, or otherwise.

(C) 2021 Electronic News Publishing, source ENP Newswire

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Financials
Sales 2022 219 B 2 966 M 2 966 M
Net income 2022 15 577 M 211 M 211 M
Net Debt 2022 - - -
P/E ratio 2022 20,4x
Yield 2022 -
Capitalization 283 B 3 828 M 3 825 M
Capi. / Sales 2022 1,29x
Capi. / Sales 2023 1,13x
Nbr of Employees 22 759
Free-Float 21,2%
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Number of Analysts 6
Last Close Price 116,95 INR
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Managers and Directors
Ajay Srinivasan Chief Executive Officer
Pinky Atul Mehta Chief Financial Officer
Kumar Mangalam Birla Non-Executive Chairman
Mukesh Malik Chief Operating Officer
Amber Gupta Secretary & Compliance officer
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